"The Power of Collaborative Leadership makes Peter Senge's The Fifth

Discipline come to life. For those who agree with the basic message
of Senge, this is fascinating reading material. It clearly demonstrates
that getting involved in organizational learning is a long and tough
journey. It opened my eyes."
-Ton Vervoort, Philips International BV

"The Power of Collaborative Leadership takes us beyond process man-

agement, total quality management, and even transformational
leadership to organizational learning. The authors draw the impor-
tant distinction between traditional single-loop learning and much
more robust double-loop learning, which can shake a corporation
or a society to its very foundations.
They explain how the leadership that comes from true organi-
zational learning distributes power throughout the organization,
rather than concentrating it in a centralized hierarchy.
The Pourer of Collaborative Leadership is a thought-provoking and
important contribution to management literature that every busi-
ness leader should read, reflect on, and learn from."
--Peter A. Darbee, Senior Vice President,
CFO, and Treasurer, PG&E Corporation

"In The Power of Collaborative Lectdership, Bert Frydman and Iva

Wilson allow us to journey with them through their odyssey of
learning within large, highly structured organizations faced with
new market demands and rapid technological change. This book is
an honest and personally candid accounting of their personal learn-
ing experiences and the challenges that all who greet life with an
open mind and a desire to search out new frontiers must ultimately
face.
This gift of a learning history will aid readers in their personal
and professional journey toward greater competitive effectiveness.
The Power of Collaborative Leadership will teach organizational leaders
to apply the principles and insights that enable all employees to
release their creative, life-affirming energy into the workplace."
-Dave Morse, Vice President,
Customer Sales and Services, Pacific Bell, SBC, Inc.

"The format of The Power of Collaborative Leadership is ideally suited

for its purpose. The authors' reflections about their experiences, as
interpreted by the ideas of organizational learning and human
dynamics, are fascinating to read. As an ex-CEIO, I found myself fully
engaged with the authors' discussions. I only wish that I had the full
benefit of this book while I was leading my own company, and I'm
sure that many other executives will feel the same way.
I would strongly recommend this book to anyone who has
taken an interest in organizational learning and who is thinking
about introducing the concepts of OL to their work environment.
7he Power of Collaborative Leadership will become a classic OL
resource book that should benefit all who care about improving the
quality of life and work in modern business organizations.
--Peter M. Banks, retired President and CEO,
ERIM International, Inc.,
and former Dean of Engineering, University of Michigan

This book is every managers story. Two senior execs who have been
through it all-restructuring, reengineering, downsizing, and
TQM-engage the reader in a rich dialogue. They argue that trans-
formation is a must in todays world and ponder whether organiza-
tional learning is the way to go. They tried it in practice and learned
a lot o n the way. So will the reader!
-Arie de Geus, author, The Living Company

If you believe as I d o that organizational learning is a requirement

if one hopes to build and sustain a successful organization, this is a
must-read. Frydman, Wilson, and Wyer provide real life insight into
the challenges of establishing an organizational learning environ-
ment. Theyve been there, and their experiences are real. Now they
have provided the opportunity for more organizations to join the
journey to an environment where people can build futures.
-Rich Teerlink, retired Chairman and Chief Executive Officer,
Harley-Davidson, Inc.

The Power of Collaborative Leadership is an extraordinary opportu-

nity to participate in a reflective conversation with todays foremost
organizational explorers. Their process of learning and the practical
integration of their collective experiences unfold before the reader.
-David Marsing, Vice President and COO,
Network Communications Group, Intel Corp.

The Power of Collaborative Leadership goes beyond the usual touting

of ones successes by taking a courageous look at failures as well, and
providing rich insights into the pitfalls and the challenges of pursu-
ing visionary aspirations in the face of pragmatic realities. Through
candid reflections and thoughtful dialogue, the authors provide
valuable lessons about what it takes to embark on a learning jour-
ney, both individually and as an organization. This book is a must-
read for all leaders who are serious about transformative change in
their organizations.
-Daniel H. Kim, Founding Member, Society for Organizational
Learning; Co-founder, Organizational Learning Center at MIT; and
Publisher, Pegasus Communications, Inc.
The Power of Collaborative Leadership expresses an approach to busi-
ness that releases creativity and empowerment in the relationships
between individuals at all levels of the traditional corporate organi-
zation structure, and therefore has the potential to revolutionize the
structures of corporate organizations in the future. Reading 7he
Power of Collaborative Leadership is not an end in understanding the
learning model but a beginning in the exploration of the limitless
opportunities that open creative expression (both within and
around organizations) has the potential to unleash.
-Michael J. Kearney, Executive Vice President, Advance
Transformer Company (a division of Philips Electronics)

The true power of 7he Power of Collaborative Leadership lies in the

frankness of the conversation that I v , ~Wilson and Bert Frydman, two
early adopters of organizational learning, have with the reader. Iva
and Bert call it like it is in the real world-through vivid descriptions
of the challenging but valuable journey to become more effective as
leaders of learning organizations.
-Kenneth W. Freeman, Chairman and CEO,
Quest Diagnostics Inc.

What happens when two very successful senior business executives

become enamored of an academic theory and apply it in two differ-
ent industrial-age organizations? Anyone interested in organiza-
tional learning, institutional change, or new concepts of leadership
will find much to ponder in this candid dialogue between two lead-
ers as they share their fascinating experience with corporate culture
change.
-Dee Hock, Founder and CEO Emeritus, Visa International;
author, Birth of the Chaordic Age; Founder and Coordinating
Director, The Chaordic Alliance

A very useful and insightful book. It is fascinating to hear two real

practitioners of organizational learning examine-and learn from-
their own experiences.
--Phil Carroll, Chairman and CEO, Fluor Corporation

Reading The Power of Collaborative Leadership is like crossing the

Rubicon of life-as businesses and individuals alike discover the
power of organizational learning, there will be no turning back. The
learning experiences shared in this book provide sound reality to
organizational learning theory that will shape both high perfor-
mance organizations and high-quality interpersonal relationships.
The Power of Collaborative Leadership is a gift to the next generation.
-Ken Baker, President and Chief Executive Officer
Environmental Research Institute of Michigan
"Provocative and challenging! The authors offer readers a new per-
spective on how to lead an organization, how to involve employees,
and how to get results through people involvement and learning.
They give receptive leaders a new tool for the toolbox as Senge and
Peters have done before them. You may not agree with all the con-
cepts presented, but I am sure you will be a better leader after read-
ing 7'he Power of Collaborative Leadership."
-Clifton I,. Smith, President and CEO,
Corning Asahi Video Products Company

"In The Pouter of Collaborative Leadership, the authors open their

hearts with a great deal of courage. They share the doubts, uncer-
tainties, disappointments, and frustrations encountered during their
journeys, while still growing from such rich and volatile learning
experiences. The reader gains invaluable insight on the dos and
don'ts so fundamental to any business manager who strives to move
an organization to a new level of performance through organiza-
tional learning"
-Marcos Magalhiies, CEO, Philips Electronics, Latin America
 -&A member of the Reed Elsevier group

Copyright 0 2000 by Bert Frydman, Iva Wilson, and JoAnne Wyer

All rights reserved

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Frydman, Ben, 1345-

The power of collaborative leadership: lessons for the learning organization/
Bert Frydman, Iva Wilson, JoAnne Wyer.
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Includes bibliographical references and index
ISBN 0-7506-7268-4 (alk. paper)
1. Organization learning. 2. Leardership. I. Wilson, Iva 1338- 11. Wyer,
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We would like to dedicate this book to the people
of the Pacific Bell and Philips Display
Components for participating in these
experiments and making it possible for us
to learn and to write this book
Foreword
Whoever does not understand history is doomed to repeat it.
This familiar refrain has rarely been more timely, especially in the
world of organizations and management.
In this era of profound change, it is hard to find organizations
anywhere-businesses, schools, healthcare organizations, govern-
mental organizations-that are not trying to reinvent themselves,
develop e-commerce strategies, or dismantle old cultures to adapt
to new realities. But their efforts are usually disappointing. The
history of success of quality management, reengineering, or the
more recent trend, knowledge management, is dismal. Typically,
less than a third of these programs are even still alive a year after
they are announced. Those that survive rarely achieve hoped-for
impacts. Obviously, sustaining change in established institutions
is not easy.
But what is even more disquieting is how little serious effort
managers seem to muster to understand why change efforts fail.
Try and try again seems to be the motto. Yet, repeating yester-
days errors is not likely to produce tomorrows success. What
hope can there be for learning if what is actually going on is that
no one wants to talk about failure. If it is not safe to explore
what happened when highly visible change efforts produce disap-
pointing outcomes, these problems will be repeated. Yet, under-
taking such reflective self-examination takes time. Analysis can
quickly become finger pointing. So, it is also easy to see how it
may seem better to ignore disappointments, to declare victory and
move on-even if that means the disappointments will likely be
repeated, often by some new change leader.
Ironically, learning from success fares no better. Because of the
lack of appetite to study our history, when successful change does
occur in some part of a larger organization, it rarely spreads. In
fact, the innovators typically leave rather than deal with the inter-
nal politics and bureaucracy of their former employers.

xv
xv i Foreword

For example, several years ago, a leading auto manufacturer

brought out a new passenger car which eventually proved to be
one of its most successful ever. It was a best seller for over 15 years.
The team that developed the car became mythical within the
industry. They developed extraordinary spirit and camaraderie.
They broke lots of rules. They pioneered innovations in process
and leadership methods. And, they all left the company within a
year after the car was launched.
Recently, a major American electronics manufacturer intro-
duced a dramatic new product platform, the first fully digitized
product of its sort. The product is also almost completely reman-
ufacturable; that is, when the customer is done, they can give it
back to the manufacturer and new machines will be built from the
old, thereby achieving both substantial cost savings and reducing
environmental waste. The product has won many engineering
awards, and after two years, its sales exceed all forecasts. Yet, its
lead engineer, who also developed extraordinary teamwork
through his innovative leadership, has also left the firm, and other
members of the original product team have scattered.
In neither case was there any effort by the firm to understand
why the innovators were so successful. If they broke rules, maybe
the rules are wrong. If they created new practices, maybe others
could learn from them. None of these larger changes has occurred,
because there was no attempt to study or learn from the innova-
tors. This pattern of failure to learn from highly successful but rad-
ical innovations occurs far more often than most recognize.
I have come to the conclusion that the inability to learn from
history is not just due to lack of will or political conservatism.
Though these undoubtedly play a part, there are deeper issues. We
simply do not know how to learn from history where change
efforts are complex and their outcomes, both successful and
unsuccessful, are threatening. Managers are action-oriented peo-
ple. They are paid to produce results not insights. Even if they are
reflective by nature, which many are not, they have little help in
doing so, and very few models to guide them. And matters are get-
ting worse, not better. With overwork and stress levels rising, what
little predisposition for reflection and analysis exists is now
swamped by a rising sea of day-to-day urgency. The search for
quick answers results either in Heres how we did it books by
retired or current CEOs, most of which offer little serious reflec-
tion or self-criticism, or in typical academic case studies that look
at a complex change process from the proverbial 50,000 feet,
summarizing everything in fifteen pages. More serious academic
studies of change typically take a theoretical point of view that
 Foreword xvi i

gives little sense for the feelings and thinking of those on the
field of battle. Overall, we lack a genre of reflective histories that
both serious practitioners and academics alike would find valu-
able.
This problem has been very evident to those of us who have
worked to develop the Society for Organizational Learning (SOL).
SOL was founded to promote partnerships among practitioners,
researchers, and consultants to build knowledge for fundamental
change. Most of the corporate members are Fortune 100 compa-
nies. Over the past ten years, SOL members have undertaken many
major change efforts, often with researchers closely involved. This
has resulted in a series of learning histories and other reflective
studies that, we hope, will contribute useful exemplars of what is
possible when practitioners are committed to building transfer-
able knowledge and researchers are committed to practical
impact.2
I am very pleased that The Power of Collaborative Leadership has
now arisen from the spirit of partnership and mutual inquiry
within the SOL community. It is a rare book, one that actually cap-
tures thinking in the moment from experienced practitioners. It
reflects the complexity of feelings and multiplicity of interpreta-
tions that coexist in complex change efforts. It shows how time is
needed to make sense of things, and how that sense-making can
continue to evolve for many years. It weaves theory and practice
with integrity by delving deeply to explore non-trivial insights and
potential guiding principles that emerge from experience. In short,
it is a very exciting book for those of us genuinely interested in
expanding our capacity to learn from history. For those looking
for easy answers and quick futes, it would better to look elsewhere.
In many ways, the uniqueness of the book arises from the
three-way partnership that produced it. It starts with two very dif-
ferent managers, Bert Frydman and Iva Wilson. Bert and Iva have
been involved in organizational learning efforts in large, well-
established firms for many years. Both rose to hold positions of
influence in their organizations. Both had a passion for innova-
tion and believed deeply that their organizations had to change.
Yet, you can hardly imagine two more different personalities
or styles of leading change. Bert is Canadian-American. Iva is
Eastern European. Bert rose through the ranks, starting as a field
technician. In a sense, he was always close to the mainstream of
his organization. Conversely, Iva was always on the periphery of
the mainstream. She was the first woman to earn a Ph.D. in engi-
neering at a prestigious German university. In virtually all of her
engineering managerial positions, she was the first woman.
xviii Foreword

Eventually, she became the highest-ranking woman manager for a

global electronics firm. Hers is an impressive CV, but it was not an
easy journey, just as it is not easy for most women like her who
have breached the walls surrounding previously male-dominated
workplaces.
Berts and Ivas differing career paths also signal very different
leadership styles. Bert is a problem-solver by nature, a practical
person shaped by what Ed Schein calls the operator culture in
which he grew up professionally.3 Iva, by contrast, is a product of
what Schein calls the engineering culture. Because of this, by the
time they became executives they brought with them very differ-
ent mindsets. Bert tends to see a messy world of imperfect solu-
tions achieved by committed people acting locally, often without
much support from management. Iva tends to be proactively
optimistic,to use Scheinsterm, believing that complex problems
can be understood and conceptual breakthroughs are possible.
The third member of the partnership is a gifted researcher,
JoAnne Wyer. To her credit, rather than suppress the differences
between Iva and Bert, as most would have done, JoAnne artfully
accentuates them. The result is a fascinating tapestry of different
perspectives facing the common challenges of transforming orga-
nizations. These are exactly the types of differing worldviews that
characterize most management teams. When the differences are
honored, synergies can develop. When they are suppressed, polit-
ical gamesmanship tends to dominate, and the team as a whole is
usually capable of little more than watered down compromises.
So, in this way, Bert and Ivas conversations are a window into
how real dialogue among truly different people can energize orga-
nizations. Lastly, Bert and Ivas differences not only highlight their
views, but also make it easier to discover your own views. You will
find yourself drawn in, taking sides, agreeing strongly with one
and disagreeing equally strongly with the other. You will then dis-
cover that what you are really finding out about is yourself their
passions evoke your own. You are a party to the conversation. The
circle of reflection is expanding.
Making the tapestry still richer are four exceptional executive
leaders from other SOL companies, whose views are woven into
the conversation. Bill OBrien, former CEO of Hanover Insurance,
helped a bankrupt company become one of the top performers in
the U.S. property and liability industry over a 20-year period. Rich
Teerlink was CEO during one of the most famous corporate
revivals in recent history: the rebirth of Harley-Davidson. Phil
Carroll was CEO of Shell Oil for five years, during which the com-
pany went from record losses to record profits (Phil is now CEO
 Foreword xix

of Fluor Corporation). David Marsing, former VP of Assembly and

Test Operations for Intel, has headed some of Intels most suc-
cessful manufacturing facilities, and is now COO of Intels new
Network Communications Group. Each also knows the difficul-
ties of learning from history in todays crazy business environ-
ment. Together, this ensemble explores how one gauges the readi-
ness of organizations for change, the creative frustration that
often motivates change leaders, distinctions in organizational cul-
tures that either enhance or inhibit learning, the art of finding the
right amount of tension around change without triggering auto-
matic responses from the organizational immune system, and
what it means to be ready personally to lead such change. In short,
what develops is a fascinating conversation exploring both the
inner and outer dimensions of deep change.
When Iva and Bert first told me of their intention to write a
book based on their stories, I confess to having had some reserva-
tions. They had accomplished a lot in their careers, but I also knew
that both left their organizations disappointed with not accom-
plishing all that they had intended. They had undertaken change
efforts in exceedingly complex situations, with many forces out-
side their control. They made some mistakes, by their own assess-
ment. Their stories are fascinating, and undoubtedly represent the
great majority of change efforts. Still, I wondered how many
would be drawn to such a book. I feared that many readers of
management books are hooked on (often exaggerated) great suc-
cess stories, combined with three easy lessons for how you too
can succeed.
Then I read Bill OBriens comments. He too left his company
disappointed, forced out after 20 years of dramatic improvements
by a hostile takeover from a parent firm with majority ownership
seeking greater control of Hanovers profit stream. These are not
isolated failures of strategy or execution, says OBrien, but
inevitable setbacks on the road to transforming management.
OBrien observes that the large corporation supplanted tradi-
tional family businesses early in the 20th century, bringing with it
a new style of governance. I dont think theres any question that
the basic governing theories that took us from 1320 to 1330 are
being seriously renovated, says OBrien. Were going to have a
new (governance) architecture, and this generation of manage-
ment has the rare privilege of participating in the design of the
architecture. OBriens comments helped clarify for me why this
book is as important as it is fascinating-and why it will attract
the serious readers it deserves. Those committed to the transfor-
mation OBrien describes will know that the journey is perilous
xx Foreword

and that, over the long run, it is not individual successes and fail-
ures that matter but the cumulative learning we can accomplish.
Peter M . Senge
Massachusetts Institute of Technology
Society for Organizational Learning (SOL)
June 2000

Notes

1. For many other examples of successful management innova-

tions that failed to spread, see A. Kleiner, The Age of Heretics
(New York: Doubleday/Currency, 1335).
2. See, for example, G. Roth and A. Kleiner, Car Launch (New
York: Oxford University Press, 2000), and A. Kleiner and G.
Roth, Oil Change (New York: Oxford University Press, 2000).
3. E. Schein, Three Cultures of Management: The Key to
Organizational Learning, Sloan Management Review, I336
(Fall): 3-20.
Preface
I am not a teacher, only a fellow traveler
of whom you asked the way.
I pointed ahead-ahead of myself as well as of you.

-George Bernard Shaw

Back in the fifteenth century, when the new world was beginning
to be discovered, it was the Portuguese Prince Henry the Navigator
who made the greatest contribution to modern exploration.
Though he never ventured forth himself, he set about building an
infrastructure for exploration. He encouraged and then required
his navigators to keep accurate logbooks and charts and to keep
careful notes about everything they encountered on their voyages.
Before his efforts, the notes and charts were haphazard; now they
were organized and kept in a single place. Sailors, travelers, and
adventurers of all sorts gathered in that place and shared their
experiences, adding their tales to the growing body of knowledge.
Henry brought the sea captains, instrument-makers, shipbuilders,
and mapmakers together to collaboratively plan expeditions and
assess findings, creating a feedback loop. Under his sponsorship,
cartography became a cumulative science and explorers were
enabled to go farther and farther into the unknown.' We believe
that organizational learning is also in a state of early exploration
and in that spirit we've written this book.
Our book is written primarily as a conversation between two
senior managers, Bert Frydman and Iva Wilson. It takes that form
because we wanted to capture the spirit of exploration. The field
of organizational learning is new, and the challenges to its propo-
nents, especially to businesspeople, are many. We hope that the
book will speak to businesspeople, especially those of you who
are on the verge of committing yourselves to organizational learn-
ing but haven't yet done so. We hope that the conversation fmmat
will resonate with the kind of inner dialogue that you tend to have

xxi
xxii Preface

with yourselves as you go through a decision-making process, par-

ticularly prior to making a serious commitment.
We hope that the conversation will have a familiar ring-that
you, the reader, will identify with some of our points of view. In
this book Bert represents our pragmatic side, and Iva our visionary
tendencies. Of course, everyone has aspects of both. We hope that
by making the debate between these two poles explicit we can
bring you into the conversation. We trust that we will say things
you are also saying and ask questions you are also asking, and that
you will have a sense of participating along with us. We need to
explore ideas together, so the thoughts and ideas presented here
are not definitive answers; they are open to challenge and ques-
tion. As we share our experiences and reflections you are invited
to shape your own arguments, your own change strategy.
The book is in the form of a conversation also because we
wanted to capture the spirit of learning. Learning is a living
process, and most businesspeople have little exposure to the
process of reflection and only a superficial understanding of learn-
ing. This book will take you along on a learning journey with us.
You will see learning emerge from reflection on experience.
These topical conversations are structured and woven together
by commentary. The worlds of theory and practice seldom con-
nect, so through that commentary I hope to provide some much-
needed links between the practical experiences of two executives
and the theories that support the concept we call organizational
learning. In the commentary I pose questions and offer further
reflections, hopefully leading us toward more discoveries and
insights. This structure mirrors the process by which the book was
conceived and written.
The book was created in a spirit of collaboration. Each of us
brought our unique gifts to the process of writing this book. Along
with her senior management experience in the field of consumer
electronics, Iva brought energy, commitment, and, especially, the
perspective of a visionary-one who sees possibilities and urges us
toward the future with conviction and charisma. Iva set high stan-
dards and challenged us to meet them. Also a senior manager, Bert
was a self-described pragmatist who earned his stripes in the
telecommunications industry. Averse to discussing theory for its
own sake and skeptical about the business worlds inclination to
change without proof, Bert kept us practical. He grounded our
thinking, reminding us that there is still a wide chasm between the
world we want to create and the world we have created. Both man-
ifested courage. They were willing to let their guard down, to
expose their missteps, to examine their mental models, and to
probe deeper into many of the assumptions that drove their
 Preface xxiii

actions so that they and others might learn from their experiences.
For my part, I brought a strong passion for building bridges
between practice and theory and for helping change leaders to
find the theory that would help illuminate their practice, as well
as a desire to translate individual experiences into stories from
which others could learn. I also had expertise in deep listening
and a commitment to developing our capacity for reflection.
Through this collaboration-sometimes quite challenging to
sustain-we created more than we would have been able to create
separately. We came to realize firsthand the power of collaborative
leadership, but this alchemy came about quite by accident.
Some three years prior to this book being published, I had
played the role of catalyst, bringing Bert and Iva together to talk
about their experiences with organizational learning. As they
shared their stories about their struggle to create change and trans-
formation within their respective organizations, they discovered
common ground. This spark was enough to turn that first
encounter into a series of telephone conversations. Together, the
three of us began a more deliberate process of exploring what we
might learn from Berts and Ivas experiences with organizational
learning. In time, we evolved a structure whereby we would come
together to share insights and, hopefully, learn more together
about the field of organizational learning. During these meetings
I would fulfill the role of interviewer or facilitator, listening deeply
to their stories and thoughts, catalyzing further reflection through
the questions I asked. In this capacity I found the following ques-
tions to be continuously in my mind: What could Bert and Iva
learn from each others experiences?What could others learn from
Berts and Ivas experiences? What was the larger meaning behind
their stories? How do their stories connect to the theory that sup-
ports organizational learning? I became the container for our
process, both a witness to and synergist for their learning, focus-
ing on drawing out the reflections, the insights, the deeper real-
izations.
In time we thought we had accumulated sufficient insight that
we might be able help other early explorers of organizational
learning, so our conversations became even more purposeful as
we attempted to develop this practical wisdom into a book.
Toward that end, I created a structure to guide our explorations,
and then distilled some 150 hours of taped conversation into a
manuscript. We then reviewed and edited that manuscript in con-
tinuous collaboration with each other.
Although quite different in many ways, all of us have a deep
and abiding commitment to the field we call organizational learn-
ing. We believe that the path to organizational transformation is
xxiv Preface

still uncharted and therefore it is a journey-a journey to be trav-

eled and spoken, argued and walked, told and debated. Just as
Henry the Navigator surmised, we need all of the aspects of the
journey. We need the ideas, concepts, and theories to spark inter-
est, to get sponsorship and launch the ships. We need the empiri-
cal research to substantiate our ideas and confirm our sighting. We
also need the stories told by the early explorers. They especially
need to talk aloud about those outcomes that did not match their
expectations.They need the opportunity to reflect on, discover, and
value the learning that can be gained from those setbacks. They
need to do so in a collaborative setting that is sufficiently safe and
yet also adequately challenging so that learning can take place.
Through their commitment to reflect and learn together, those who
have gone before can help illuminate the path so that others can
find their way a bit easier. In time, we will understand the territory,
and, through learning, we will transform it.
In the beginning, we thought that this book came to be because
of chance. Later, we learned that what we thought was chance was
really an act of synchronicity. What are the odds that our lives
would cross and become intertwined in this way? Chance says the
odds are remote, but synchronicity says that it is no surprise.
JoAnne Wyer

Endnotes

1. For more on Henry the Navigator, please see Daniel J.

Boorstin, The Discoverers (New York: Random House, 1383),
pp. 156-164.
Ac know Ied g ment s
The authors wish to thank the following for their help and support:
Arie de Geus, Peter Senge, and Dee Hock for encouraging us
to start the project.
C. K. Prahalad for giving us important critical feedback
along the way.
Phil Carroll, Phil Fazio, David Marsing, Dan Mlakar, Bill
OBrien, and Rich Teerlink for agreeing to be interviewed for
the book.
Richard Sachs and Ann Wilson for their help with illustra-
tions, and also thanks to Ann for her help with our Web site.
Nan Gill and Steven Gill for the care and understanding they
exhibited when we asked them to read the manuscript and
give us their critical remarks. Their reflections and honest
comments allowed us to make significant changes that made
this book better. We pay a tribute to them as exemplary prac-
titioners of organizational learning.
Vic Leo for reading the manuscript and sharing thoughts
based on his own long professional experience in the field
of organizational learning.
Giovanna Morchio for her insights and guidance toward the
literature that deals with complexity and organizational
learning.
Ken Murphy, Sarita Chawla, Peter Darbee, Tom Durel, and
Cliff Havener for their reflections and insights.
Don Seville for being a thinking partner on causal loop
diagrams.
Learning as Leadership in St. Raphael, California for the
tools we used to develop our personal mastery. In particular,
thanks to the late Claire Nuer and also to Lara Nuer for their
personal support during the journey of writing this book.

xxv
xxvi Acknowledgments

Last, but far from least, we wish to thank our partners, Tom
Wilson, Rosemarie Frydman, and Robert Levin, who provided
support, understanding, love, and feedback throughout our learn-
ing process.
Introduction
Talking Revolution

The business world is in great need of change. If the recent bur-

geoning of trends and fads in management tells us anything, its
that the field is in flux.It seems that business is searching desper-
ately for new ideas, quickly jumping from one to the other, hunt-
ing for the silver bullet. Yet, simultaneously, there is a sense that
much in the world of business management is intransigent, stay-
ing the same despite a need for change and despite solid evidence
that supports change. It is a contradictory image. To the same
point, the cartoon Dilbert depicts the corporate environment as a
place where people are frustrated, even defeated, by insidious and
virulent nonsense, as if Alices tea party were no longer the excep-
tion, but the rule. The popularity of Dilbert sends a frightening
message, that a certain kind of madness is global.
In sum, the picture painted of many business organizations is
that they are at a turning point-challenged by enormous change
without, and enmeshed in inconsistencies and a good deal of per-
sonal pain within.
Can we recreate our business organizations, making them
more effective and saner, transforming them through learning-or
is this just a pipe dream? What will it really take to bring about this
transformation? These are questions that an increasing number of
people in the business world are beginning to ask, but where will
the answers come from?
Most management books are written by well-informed and
accomplished academics or consultants. These books advance a
new theory or suggest a different approach to business issues.
Generally, this new approach is based on research into a relatively
small number of cases, and many of the assumptions that under-
lie the theory are not clearly in view. The next step is for the busi-
xxvii
xxvi ii Introduction

ness community to test the theory and see if it works. In this

model, the business community stands to benefit greatly from the
wisdom of these external experts, but businesses also bear the
lions share of risk and consequences.
While such books stir hope, help create vision, and energize
passion, they often fail to discuss the enormity of the challenges
intrinsic to organizational transformation efforts. Because of their
theoretical nature, these books may chart new territory, but they
cannot address the very inadequacy of the untested navigational
tools they provide. And they generally do not address the very real
risks to both self-concept and career that practitioners who
embark on these journeys may experience.
For these reasons, we believe that the solutions cannot come
solely from the academics or the consultants. Ultimately, solutions
can come only from the people within the business environment,
businesspeople who are willing-and courageous enough-to
engage with the questions.

Where Are We Going?

In response to the needs of and the pressures on their respective
organizations, Iva Wilson and Bert Frydman were both looking for
solutions. They were experienced senior managers who had found
various management approaches to be lacking in one way or
another and were looking for a better way. Their searches led them
to a relatively new management concept called organizational
learning. For us, organizational learning (OL) represents the
process of forming and applying collective knowledge to prob-
lems and needs. It is learning that helps the organization contin-
ually improve, achieve goals, and attain new possibilities and
capacities. It is learning that taps into employee aspirations, h e l -
ing commitment and creating the energy to change.
As our stories and reflections on those stories will show, there
is much to learn (and unlearn) about how to realize the potential
of OL. Primarily we had to learn that OL is a process. Because it is
a process, it can never be treated as program or a thing that, if
implemented, will lead automatically to the accomplishment of
results in the short term.

Early Hopes
Iva Wilson was a visionary engineer who was president of the U.S.
division of a global electronics manufacturing firm. A technologist
with a Ph.D. in electrical engineering as well as an MBA, Iva had
been involved in many facets of research, development, and man-
 introduction xxix

ufacturing of cathode ray tubes (CRTs) during her career. One of

her most significant contributions was in the field of electron
optics. She holds a major patent on the Extended Field Lens,
which has been applied to a multitude of different electron gun
designs for CRTs throughout the world.
When Iva first became acquainted with the concept of organi-
zational learning she saw a new and possibly very powerful means
for integrating the power of technological know-how with the
aspirations of the people in her organization. Through organiza-
tional learning, Iva believed she could create an effective compet-
itive strategy for her company.

Iva: What really spoke t o me about organizational learning was the

focus on systems, the idea that everything is connected. I had been
familiar with systems dynamics from a technical perspective, but orga-
nizational learning provided the application o f systems dynamics t o
human systems, to business systems. Now, suddenly, there was a way of
applying what I thought was a strictly technical methodology to the
understanding o f all kinds of other systems: business systems and orga-
nizational systems and people systems. That was very exciting.
I saw a real opportunity for organizational learning to help us create
results both for the business and for the individual. This was a completely
new way of thinking for me. Before, my view was that people create their
own circumstances and their lives are their responsibility. If people don't
do things themselves-if they don't study and work hard-then so be it.
But, among other things, organizational learning is about what's possi-
ble if we can create a shared vision. It's also about who we can be if we
practice personal mastery. All o f those things opened a door t o a new
world.

By contrast, Bert Frydman was a senior line manager in the

field of telecommunications. Bert began his career on the ground
and worked his way up-quite literally. He began by climbing
telephone poles as a service technician. From there, motivated by
a thirst to understand all aspects of the business, Bert moved on to
hold management positions in various capacities within the
telecommunications industry, including engineering, construc-
tion, operations, new products, procurement and staff methods,
while also finding time to teach at the university level. Bert
became involved in organizational learning in 1331 while serving
as the Service Policy and Quality Vice President for Pacific Bell,
responsible for the implementation of strategic initiatives regard-
ing competitive service for all of Pacific Bell's core markets.
Customer service had long been Bert's passion but, for a variety of
reasons, it was not always easy for his company to keep the focus
xxx Introduction

on the customer. Bert saw organizational learning as a natural

complement to his work in Total Quality Management (TQM),
and he believed that he could use the organizational learning
approach, particularly systems thinking and simulations, as a way
of generating a greater awareness of the relationships and interde-
pendencies involved in customer service. If people understood
these relationships, he believed, it would lead naturally to
improvements in customer service.

Bert: After being exposed t o organizational learning and listening to

Peter Senge, it dawned on me that organizational learning would be a
natural for us. We were already going down the Quality road, but I was
concerned that with that approach we could be improving processes that
have no business even existing. There was that lingering question: Is the
process we're using really the best way of doing it? Organizational learn-
ing gave us tools for inquiring into the usefulness of our processes.
So I was really enthused about organizational learning. Also, I was
very impressed with the potential of simulations, which is another aspect
of OL work. Simulations allow for a business model to be represented in
a computer model. In particular, I remember experimenting with one par-
ticular simulation. It was a powerful example because it showed very
dramatically how you could get different results by making changes to
the different variables. Depending on what decisions you made, the sim-
ulated company either succeeded or failed. You could see the relation-
ship of your decisions to that failure because i t showed how you could
get dramatically different results by making small changes to certain
variables. This was particularly salient because the company actually
failed in real life just as the simulation predicted it would, given these
same decisions. From that example i saw clearly how we could use sim-
ulations to help us make better business decisions. A simulation could
help us see those connections and understand the consequences of our
actions.

Excited about the potential they saw in organizational learn-

ing, both Bert and Iva set out to apply what they had learned. They
began what they hoped would be successful organizational trans-
formation efforts, introducing organizational learning concepts
into their respective companies. Despite the differences in indus-
try, focus, and strategy, they both discovered that they faced a myr-
iad of unanticipated obstacles, some common and others unique.
 Introduction xxxi

Implementation Blues
Bert: You could say that a funny thing happened on my way to build-
ing a learning organization. In fact, a lot of funny things happened-things
I didnt expect or anticipate.
Iva: My journey was also full o f surprises and, as a result, new ques-
tions. I wonder, did either of us fully comprehend what we were getting
into when we started? Books are helpful, of course. You can learn a lot
from them-but true learning can only occur when you practice organi-
zational learning in a real organization with real people under real pres-
sures.
Bert: Thats when you begin to realize how much needs to change-
and conversely, how little we understand about how t o change it.
Iva: You realize how many dilemmas you can get into by thinking
about things in the same old way-
Bert: And how fiercely the organization itself will resist all your good
ideas and intentions. Thats when you come to terms with a fundamen-
tal question: How deep is your commitment to this work? Are you will-
ing to work through those dilemmas and learn from them?

The task of bringing about organizational change has never

been for the faint-hearted, and Bert and Iva were no exceptions.
They encountered many of the typical responses to change efforts.
For example, many times people in an organization adopt a this
too shall pass attitude. Having seen leaders go off to classes and
then return talking funny for a few weeks, people dont expect
new behaviors to be sustained over time. If the leader does sustain
commitment to OL work, people within organizations that are on
a learning journey will most likely feel at sea because their
leaders actions will now be harder to decipher. Those who have
grown used to a command-and-control environment will be
bewildered when the newly energized leader suddenly starts ask-
ing their opinions. Most likely, they will tend to distrust this sud-
den shift and hold back. They may even resent being asked to
become more involved in decision making, for command-and-
control has its comforts. As organization members begin to
engage with organizational learning they may experience a disori-
enting alteration in perspective. Transitions-even those that may
be profoundly beneficial-confuse because they confound expec-
tations.
These are some of the issues that leaders of organizational
learning efforts will face and some of the experiences they can
expect. Furthermore, the idea of transforming a business into a
learning organization presents its own unique set of challenges
xxxii Introduction

because the journey to the learning organization requires passage

through unknown and uncharted territory.

Heroes, Heretics, or Prophets?

Why did Bert and Iva encounter these dilemmas? One reason lies
in the very nature of organizational learning itself. Both Bert and
Iva discovered organizational learning as expressed by MITs Peter
Senge in his now classic work, The Fifth Discipline: me Art and
Practice of the Learning Organization (1930). The Fifth Discipline is a
powerful synthesis of theory, philosophy, and good business
sense, and describes an array of tools and methods that can be
applied in organizations to bring about increased learning. But
before we can realize the promise of OL, Senge cautions, we may
need to give up our illusions. The tools and ideas presented in
this book are for destroying the illusion that the world is created
of separate, unrelated forces, writes Senge on page one of The
Fifth Discipline. When we give up this illusion, we can then build
learning organizations.
Business leaders and would-be change agents who embrace
the learning organization as a logical, practical goal may not ini-
tially see themselves as destroyers of illusion or corporate
heretics, but that is, in fact, how they will be viewed by many.
They must anticipate and be prepared for this eventuality-and
for many other surprises.
The reality-and the irony-is that these people of vision will
be at risk because, unfortunately, the illusion Senge alludes to is
the very linchpin of the worldview that dominates the business
arena. We live in a world defined by reductionistic thinking, more
driven to break things down into component parts than to see the
whole. We tend toward the compartmentalization of thought and
feeling, often valuing one over the other as if they were actually in
competition with one another. We have a strong tendency to
dichotomize, to set both ideas and peoples in opposition to one
another rather than seeking to understand how they relate both to
ourselves and to each other. Rather than bearing witness to com-
plexity, we tend to hold the perception that there is a simple, eas-
ily discernable relationship between cause and effect.
As we are beginning to learn through pioneering work in the
field of physics and other disciplines, these aspects of the current
Western worldview are inadequate for representing all of reality.
Furthermore, we are beginning to see that by relying solely upon
these concepts we have created an illusory sense of reality that, in
turn, produces beliefs and actions that can be faulty or even harm-
 Introduction xxxiii

ful. The word "paradigm" is so frequently used as to be overused,

but that doesn't make it any less real. The business world is
immersed within a paradigm of its own creation. In many
respects, it is a system based upon this outdated worldview and,
for that reason, it does some things well and others quite poorly.
Ways of thinking and acting-and the illusory reality they cre-
ate-are deeply entrenched and hard to dislodge. At its best, orga-
nizational learning enables us to explore how these ways of
thinking and acting may be limiting our ability to get results in
the traditional business sense and to create the results we truly
want in the larger sense. Through practice in organizational learn-
ing we can begin to dislodge these inappropriate beliefs, ideas,
assumptions, and actions, and we can begin to replace them, not
with other fixed and rigid ideas, but with the dynamic process of
learning.
When we say that we need to transform our organizations in
significant ways, we mean that we need to bring them in align-
ment with the significant shifts that are taking place in our under-
standing of the world and the way it works. Breakthroughs in
physics, in our awareness of the complex interrelationships of
large systems, as well as the unprecedented globalization of the
economy, all have implications for our institutions and our orga-
nizations. Business organizations are also being asked to reexam-
ine their ethics and reconsider their responsibilities to the health
and well-being of individuals, the community, and the natural
environment. We are just beginning to understand what those
implications might be and how to come to terms with them. We
suspect, increasingly strongly, that we must respond.
To creatively address the present and the future, we need to
understand what that task involves and why it is an order of mag-
nitude different from any other task we have encountered in our
lives. This presents another reason for why our learning projects
may not meet our expectations. Chris Argyris, consultant, author,
and the James B. Conant Professor at the Harvard Business School,
has observed a pattern that he sees as characteristic of the way
businesspeople have approached organizational changes such as
TQM, flat organization, reengineering, and management empow-
erment.
The pattern begins when we see a prescription for organiza-
tional reform (such as "empowerment" or reengineering) appear
on the horizon. More often than not the new idea even contains
a genuine insight and is supported by theory as well as stories of
successful implementation. All of this gives us hope and we reach
out. Almost inevitably, however, we turn the idea into a "fix"-we
xxxiv Introduction

condense it down into what we think is an understandable pack-

age of procedures. Too often we accompany the package with an
ideology that has quasi-religious overtones. Managers latch onto
the package because they're hungry for solutions to persistent
issues and tired of gurus advising them to "wrestle with complex-
ity" (or suggesting that they're colluding in creating problems). As
the managers sign on, a bandwagon effect ensues. Then the resis-
tance and the defensiveness show up. The top level becomes frus-
trated at the resistance of the lower levels. In time, disillusionment
begins to appear and, along with it, cynicism. People begin to say,
"We tried that!" The change effort ceases, only to start all over
again when the next reform appears on the horizon.2
In sum, we are primed to turn good ideas into organizational
"fixes" because our ways of being, acting, and thinking are deeply
rooted in mechanistic, reductionistic worldviews. Because of this
automatic response, we may tend to see organizational learning as
a "thing" to be implemented rather than a process to be lived.
Even the word "tool" (as applied to OL tools and methods) is dan-
gerous because it supports our tendency to tinker with parts, to
repair the machine, rather than to conceptualize living wholeness.
This idea gives rise to a third reason that change may be diffi-
cult: as leaders of change in organizations, we may have underes-
timated the need for our own personal learning. In order to come
to terms with how to bring about organizational learning, we
must each engage in a process of deep and complex learning.
Because so much has changed and is changing-and we are not
fully aware of the extent nor the implications of those changes-
we must be willing to acknowledge that we do not, perhaps can-
not know. We must surrender the sense of security that our know-
ing provides and learn to inquire, asking and holding questions
when the answers do not immediately come. We must encourage
diversity in order to become unstuck, to provoke new ideas and
challenge old ones. We must make ourselves vulnerable to a deep
and apparently threatening form of learning. We must allow our
most tacit and closely-held assumptions to be open to question.
Rather than deploying our well-oiled defenses, we must allow our-
selves to show vulnerability. Each of us must learn again what it is
to learn, not superficially, but deeply. And we must learn to
unlearn as well. Moreover, we must do this not as heroic individ-
uals, but in community with others who are also engaged in learn-
ing. In collaboration lies the greatest power, and this is the jour-
ney. The process of organizational learning is about actualizing
the power of collaborative leadership.
Is there another reason why we may not succeed with organi-
zational learning? Perhaps we may discount the gift of failure for,
 Introduction xxxv

in times of uncertainty, it is exceedingly instructive. At its best,

organizational learning is not business-as-usual. It cannot be nor
should it be-and that is problematic for leaders of learning
efforts. The potential rewards of organizational learning-and of
more collaborative leadership-are great, but getting there is no
walk in the park. It is a journey, and we will have apparent failures.
Therefore, to be effective as leaders of learning efforts, we must
accept that a mere incremental shift in business-as-usual will not
be sufficient. The shift to an organization steeped in and shaped
by learning requires a significant transformation of an organiza-
tions ways of being and the development of new ways of taking
in information and transforming it into knowledge and wisdom.
In addition, this organizational transformation must proceed
from the personal, inward transformation of its members. There
will not be one without the other. And so, there are significant
implications for leadership as we begin to confront the realization
that sharing power is actually more effective than hoarding power.
If we sustain our commitment to organizational learning we will
both stimulate and help bring about a sea change. Of course, we
can try to subvert learning. We can try to implement it in such a
way that it turns into yet another short-lived management fad, but
we will be doing ourselves a disfavor. Furthermore, personal trans-
formation requires deep, complex learning-a kind of learning
that occurs most effectively in community with others who are
also learning. This is a new practice for most of those in business
organizations.

Bert: As Iva and I compared stories we learned that we shared many

of the same experiences. Things did not happen exactly as either of us
had planned or expected.
Iva: Although we began by expecting that we would be changing
others, the most surprising outcome was that we had t o change. We had
to learn. I have come to understand why we need to do more o f this kind
o f learning, even though it may sometimes be painful.

The experience of deep learning shifts expectations-particu-

larly those expectations that have been shaped by the current busi-
ness environment. When one allows oneself to live in learning,
ones basic assumptions are up for grabs. For example, Bert and
Iva began by expecting that they would be changing others-after
all, they thought, this is the role of a leader, isnt it? But, in time,
they realized that the most significant outcome of their endeavors
was that they began to learn what it is to truly learn. In the course
of their change efforts, Bert and Iva also learned a great deal about
organizations, about organizational culture, about the nature of
xxxvi introduction

change and resistance, and about themselves. They learned the

value of reflection, a practice that is almost nonexistent among
businesspeople. Moreover, they learned the value of reflecting
together within a space that was both dedicated to learning and
safe.

Learning As We Go
After the visions have been articulated and the theory formulated,
the job of bringing about organizational learning ultimately falls
to the businesspeople who see the genuine potential in this field
for remaking their corporations. Those who accept the challenge
of the learning organization journey will encounter multiple para-
doxes. As they get deeper into OL work they will find that the
tried-and-true methods that led them to so much success in the
past might now fail them.
Therefore, businesspeople need to be supported in taking up
this challenge. There may be a vision, but a clear pathway to that
vision is uncharted. Organizational learning is a field in the
process of becoming. In other words, we are still learning what it
means to learn together and how to bring about significant learn-
ing within an organizational context. There is a rich body of
thought on organizational learning, some empirical research and
anecdotal evidence, and much incisive philosophy, but the bridge
from the present-day business world to that vision has not yet
been built. Although some of the elements have been defined-
such as the five disciplines put forth by Peter Senge-there is not
yet a blueprint for that bridge. There is no proven architecture of
engagement and no guaranteed method for successfully including
the doubtful, the indifferent, and the adverse.
If the organizational learning is to thrive, we must bring about
more collaboration. We must have more true partnerships. There
must be a more equal sharing of accountability and trust between
the theory-makers and the theory-testers, more opportunities for
genuine dialogue. To start that dialogue, we must begin to hear
more voices from the trenches. Businesspeople need to share their
stories because too little has been written about organizational
change from the viewpoint of those involved. Those stories then
need to be placed within a larger context so that others might
learn from them. To that end, Bert, h a , and I collaborated to write
this book, joining our voices and weaving together the perspec-
tives of the visionary, the pragmatist, and the witness as learning
analyst. Hopefully, this is a step toward realizing the power of col-
laborative leadership.
 Introduction xxxvi i

The organization of this book is as follows:

In Part 1, The Vision:
Bert and Iva describe how Peter Senges work in organiza-
tional learning engaged them and why they, two senior exec-
utives, became deeply committed to this work.
They describe why they see organizational learning as the
next evolutionary step for business organizations, framing
that argument within the context of their experiences with
restructuring, TQM, reengineering, and downsizing.
They present a range of additional arguments for the wide-
spread adoption of organizational learning. They acknowl-
edge the barriers and discuss why there is still more work to
be done so it can be widely embraced.
We close Part 1 by encouraging readers to hold the tension
between current reality and the vision of a future in which
learning holds a prominent place in organizations.
In Part 2, The Journey:
We provide a framework for interpreting Berts and Ivas
journeys. We describe organizational learning as put forth by
some key thinkers in the field. We introduce Chris Argyriss
thinking because we feel that double-loop learning is very
important (and very difficult) for individuals as well as orga-
nizations.
Bert and Iva share their learning journeys as case stories told
by the protagonist. You, the reader, will experience the gaps,
the subtleties, and the struggles both pragmatists and vision-
aries encounter on their respective journeys.
We debrief Berts and Ivas journeys.
In the spirit of Chris Argyriss double-loop learning, Bert and
Iva share what they subsequently learned from their jour-
neys. It is our intent to model double-loop learning. We
hope that our collective reflections will inform yours.
In Part 3, Leadership:
We share what they have learned about leading a learning
effort from four leaders (Phil Carroll of Shell, Bill OBrien of
Hanover Insurance, Rich Teerlink of Harley Davidson, and
David Marsing of Intel) who were early pioneers and are still
involved in applying OL thinking in their work.
Bert and Iva then reflect on their collective experience of
leadership and provide a possible framework for thinking
about the transition from traditional command-and-control
xxxvi ii Introduction

leadership to a form of leadership that develops through a

process of learning.
In Part 4, Mapping:
We offer some reflections on how you might map your own
journey. Based on the collective experience of the authors
and the other OL leaders interviewed, we describe an
approach to mapping the journey.
Bert and Iva share their reasoning and suggest questions to
ask, the questions they discovered as being important while
they were travelling on this road that is full of surprises, dif-
ficulties, and exciting experiences that hold great promise for
the future.
We end, as you might expect, with a call to action. We call to
pragmatist and visionary alike. Whether you arrive by way of self-
interest or awakening, science or philosophy, all paths seem to
converge on learning as the primary mode of transport to a viable
future. Learning is the means and, for reasons still unfolding, the
business organization is the crucible. Please join us.

Endnotes

1. Steve J. Gill, The Managers Pocket Guide to Organizational

Learning (Amherst, MA: HRD Press, 2000) p. x.
2. Chris Argyris, On Organizational Learning, Second Edition
(Oxford, UK: Blackwell Publishers, Inc., 1333) p. 51.
 Part 1
The Vision
W hen you engage with the promise of organizational learning
you are being asked to open yourselves to the following
ideas:
1. It is not only rational and desirable but also necessary for us
to pursue the goal of organizational transformation;
2. The field of knowledge known as organizational learning
holds great promise for the positive transformation of our
organizations.
The learning organization is a compelling vision because it
holds out a two-fold promise. It promises greater competitive
effectiveness through improved learning on a collective scale, and
it promises a more honest, life-affirming, energizing workplace.
Underlying the promise of organizational learning is another
premise: that, ultimately, greater competitiveness and workplace
transformation go hand-in-hand. They are inseparable. The one is
not sustainable without the other.
And there is a further implication that has to do with the way
in which the promise of organizational learning is to be realized.
It seems that organizational learning requires that many of the old
rulebooks be set aside. Specifically, we do not change our organi-
zations as we ordinarily do: by tinkering with or manipulating
them. We do not create learning organizations by restructuring,
1
2 Part 1 / The Vision

reorganizing, reengineering, or downsizing them. These options

are not precluded; rather, they are transcended. Manipulation and
control are superseded, replaced by a deceptively simple notion.
We transform our organizations by doing the hard work of trying to
transform ourselves and the teams we are part of.
This idea is quite profound. It is also fraught with difficulty
because we do not yet know exactly how to transform ourselves.
We are still finding our way. The road is only partly illuminated.
Furthermore, there is no one path that everyone can follow. It is a
highly individual journey, yet it is also a collective journey-we
are on the road, exploring, finding our way together. In a sense, we
are the journey.
Chapter 1
The Premise and the Promise
Bert: The term "organizational learning" may seem too theoretical
or conceptual or visionary. There's nothing wrong with theories or con-
cepts or visions, but I want to give people a sense of what it would be
like if it were real and alive.
I think i t was Guaspari who said about Total Quality Management
(TQM), "I'll know it when I see it." I have the same feeling about organi-
zational learning. People need to know what it would feel like i f their
organizations were learning organizations. If they walked around the
halls where people were truly living organizational learning out, what
would it look like? Would it be dramatically different? Are we all talking
about the same thing? Here's my vision:

A Learning Organization: A Practitioner's Vision

People speak in terms of continuous improvement:

e.g., "Leave it better than you found it."
People are more involved in rapid decision making without
being sure:
e g , "Seven out of ten is better than three out of three."
People openly speak of failures in a reflective tone and with-
out fear of reprisal:
e.g., "If you haven't failed recently, you are not trying
hard enough.''
People openly share what they are doing, without ego and
in the spirit of teaming and collective discovery:
e g , "The whole is greater than the sum of the parts."

3
4 Part 1 / The Vision

People are not limited to vertical thinking and are ready to

revisit the old ways and reconnect or rebuild past practice:
e g , You have to break an egg to make an omelet.
People view training as an investment, not a cost:
e.g., People are our only sustainable competitive
advantage.
People value diverse opinions and actively seek them out:
e g , The successful companies will be the ones that see
the future and its opportunities faster than the competi-
tion and act on them.
People share openly and willingly and, at the same time,
steal good ideas shamelessly, replicate, and give credit and
honor to innovators:
e.g., The popularizers will inherit the earth.
People build on each others ideas using phrases like yes,
and . . . instead of no and but:
e g , Great oaks grow from small acorns.

Iva: We also need t o tell people how we first became engaged w i t h

organizational learning through the work o f Peter Senge. Senges work
started the shift in our thinking. In particular, his five disciplines influ-
enced the way we introduced OL into our organizations.

The Five Disciplines of Organizational Learning

In The Fifth Discipline, Senge defined five component technolo-
gies that can help organizations learn, that is, develop the capac-
ity to realize the highest aspirations. These are the primary tools of
organizational learning. They are described below.
Personal mastery-learning to expand our personal capacity
to create the results we most desire, and creating an organi-
zational environment which encourages all its members to
develop themselves toward the goals and purposes they
choose.
Mental models-reflecting upon, continually clarifying, and
improving our internal pictures of the world, and seeing
how they shape our actions and decisions.
Shared vision-building a sense of commitment in a group,
by developing shared images of the future we seek to create
as well as the principles and guiding practices by which we
hope to get there.
 Chapter 1 / The Premise and the Promise 5

Team learning-transforming conversational and collective

thinking skills so that groups of people can reliably develop
intelligence and ability greater than the sum of individual
members' talents.
Systems thinking-utilizing a way of thinking about and a
language for describing and understanding the forces and
interrelationships that shape the behavior of systems. This
discipline helps us to see how to change systems more effec-
tively and to act more in tune with the larger process of the
natural and economic world.'
The premise of Senge's book was that these five disciplines, or
areas of practice, if introduced and cultivated within an organiza-
tion, could help to enhance the learning capacities of that organi-
zation. Organizational learning is the means by which an organi-
zation might transform itself and its members.

Iva: As I've reflected upon my experience I see now that the five dis-
ciplines are just one way of thinking about OL.
Bert: It could be that each company's definition of organizational
learning will be slightly different, depending upon what learning means
to them.
Iva: If there is one thing I have learned through my engagement with
organizational learning, it is that there is no "one size fits all" in this
work. These ideas should serve only as starting points.
Bert: It's also true that for some people even these definitions will
not be sufficient t o convey why these ideas are so compelling. After I
read Senge's book, it was still abstract for me. I didn't have a real, gut
sense about what i t was until much, much later-when I had a realiza-
tion that related directly to my personal experience.
Iva: That is one way in which we are different. I was very stirred by
the ideas even just reading the book, but for you it took the experience.
My sense is that that is true for our readers as well. There will be differ-
ences in what draws them to organizational learning and how they come
to learn about it.

Awaken ing
David Whyte, the poet, in his book about the corporate workplace
called The H e m Aroused, quotes a poem written by a woman who
worked at AT&T. She wrote:
Ten years ago . . .
I turned my head for a moment
and it became my life.*
6 Part 1 / The Vision

Perhaps for every person who decides to explore organiza-

tional learning there comes another turning point . . . a moment
when they turn their heads away from many of the accepted ways
of doing things in organizations and begin to consider that there
may be another way. And in that moment, however fleeting, they
may catch a glimpse of another possibility.

Iva: Bert, do you remember what it was that first captivated you
about the concept of organizational learning-the moment when you
first said, "Aha! Now I understand. This is the direction we should go in"?
Bert: Yes, I do. It was right after I finished playing the "Beer Game." I
remember the day vividly. We were in the middle of a five-day course on
organizational learning being taught by Peter Senge. A whole group of us
had just finished playing the Beer Game, and it had been a total disaster
for our team! We'd been doing all the things we thought were right to
manage the beer business, and what did we have as a result? We had cri-
sis after crisis. First, we didn't have enough beer to match the orders. Then
we had a whole warehouse full of beer and very few orders. So we felt
ridiculous. And then we learned that all the other teams had had the same
experience. Nobody could prevent the crises. And then we heard that
thousands of people have played the game and it always comes out the
same. And I thought t o myself, "Oh, is there a message in this!" The Beer
Game showed me the power of thinking in terms of systems.

Systems Thinking and the Beer Game

The Beer Game is a particularly powerful illustration of the power
of systems-and the illusions that trip us up because we do not
think in systemic terms. As Senge explains in The Fifth Discipline,
the Beer Game was first developed in the 1360s at MIT's Sloan
School of Management. It immerses the participants in a manage-
ment game simulating the production and distribution of a single
brand of beer. There are three main roles in the simulation game:
a retailer, a wholesaler, and a marketing director of a brewery. As
the participants take on each of these roles, they are completely
free to make any decision that seems sensible. Their only goal is to
manage their position as best they can to maximize their profits.
The primary rule is that the players in the various positions refrain
from communicating with each other.
The game has been played thousands of times in classes and
management training seminars over the last 30 years by people of
all different ages, cultures, nationalities, and business back-
grounds. Every time the gnme is plnyed, the snme crises ensue. First,
there is growing demand that can't be met. Orders build through-
out the system, inventories are depleted, and backlogs grow. Then
 Chapter 1 / The Premise and the Promise 7

the beer arrives en masse, but incoming orders suddenly decline.

By the end of the game, almost all players are sitting with large
inventories that they cannot unload.
What does the Beer Game tell us? If the same qualitative
behavior patterns are generated by literally thousands of players
from enormously diverse backgrounds, then the causes of the
behavior must lie beyond the individuals. The "Aha!" is that the
causes of the behavior must lie in the structure of the game itself
Another "Aha!" is that this same explanation can be applied to
production-distribution systems in real business life. Structure
often determines how events play out in business life.
When people play the Beer Game, they take on a role, either a
beer retailer, a wholesaler, or the marketing director of a brewery.
If they "manage their position"-which is typically what people
do-they don't see how their actions affect the other positions.
The players are actually part of a larger system, but most perceive
that only dimly at best. The game is also designed to limit com-
munication between the roles so that people can see clearly how
the lack of effective communication contributes to a system spi-
raling out of control. That parallels what tends to happen in real
life: effective communication across functions is limited, partly by
the "silos" created by organizational department structures and
partly by our lack of competence in the art and practice of gener-
at ive conversation .
Senge describes three lessons to be learned from playing the
Beer Game:
1. Structure influences behavior. When placed in the same
system, people, however different, tend to produce similar
results. When there are problems or performance fails to live
up to what was intended, it is easy to find someone or some-
thing to blame. But more often than we realize, systems cause
their own crises, not external forces or individuals' mistakes.
2. Structure in human systems is subtle. We tend to think of
structure as external constraints on an individual. But struc-
ture in complex living systems, such as the "structure" of the
multiple "systems" in a human body, means the basic inter-
relationships that control behuuior. In human systems, struc-
ture includes how people make decisions, i.e., the "operat-
ing policies" whereby we translate perceptions, goals, rules,
and norms into actions.
3 . Leverage often comes from new ways of thinking. In
human systems, people often have potential leverage that
they do not exercise because they focus only on their own
decisions and ignore how their decisions affect others. In
the Beer Game, players have it in their power to eliminate
8 Part 1 / The Vision

the extreme instabilities that invariably occur, but they fail

to do so because they do not understand how they are cre-
ating the instability in the first place.3
Players can improve their performance in the Beer Game if
they learn how to work with these lessons. The lessons of the Beer
Game also apply to real life. The deepest insight, Senge says, usu-
ally comes when people see how both their hopes and their prob-
lems connect to the way they think. We tend to find ourselves
caught between reacting to events and trying to create our hture-
without necessarily having the tools to make that shift. If we can
stop thinking in terms of "events" that we must react to and begin
to acquire "systems thinking," then we can see the structure of the
system and discern the structural causes of behavior. With that
insight, we can begin to create the outcomes we desire rather than
react to things that happen to us. Another key lesson is that each
player in the system must share this systems viewpoint. If any one
player in the Beer Game panics and places a large order, panic
tends to spread throughout the system and instability ensues. So,
too, in real life. Another important aspect of systemic thinking is
that players must learn to anticipate that there will be a delay
between actions and consequences, and acquire the patience to
cope with the delay. Interestingly, in the Beer Game-and in many
other real-life systems-in order for one to succeed others must
succeed as well.4
The Beer Game is a very rich wellspring of learning; partici-
pants respond to the insights that are most compelling for them,
the insights that shift their thinking.

Bert: The Beer Game proved to me that when you're in a system like
that, it doesn't make any difference who you are or what your qualifica-
tions are, you are destined to fail. Yet, in the business world we actually
fire people on the basis o f performance when, in fact, an individual's per-
formance doesn't make any difference. The effectiveness of any individ-
ual performance is very much determined by the system the individual is
in. O f course, there are a few cases where the person in question is, in
fact, incompetent, but in most cases it wouldn't make a difference who
you put into the job. Given a dysfunctional system, he or she is going to
fail. That's what the Beer Game taught me.
Iva: For me, the turning point came during the systems dynamics
part of the training on organizational learning given by Peter Senge, but
it was during a different part o f that discussion. On the third day or so,
we were asked to divide into groups o f five and practice creating causal
loop diagrams t o represent some of the major problems we had in our
businesses.
 Chapter 1 / The Premise and the Promise 9

Systems thinking is a discipline for seeing wholes, a frame-

work for seeing interrelationships rather than things and patterns
of change rather than static snapshots.5One way to begin to see
the world systemically is to begin to tell stories differently. We can
break our tendency toward linear, reactive thinking when we
express those interrelationships by actually drawing them as cir-
cles of influence. These circles, or causal loop diagrams, enable us
to see that what we think of as random events are actually patterns
that repeat themselves.6

Iva: There were approximately one hundred people in the training so

there were a great many groups drawing these diagrams. When we were
all done, I looked around the ballroom. Each group had drawn its causal
loop diagram on an easel, and as I looked I realized that everyone o f the
easels depicted one ofmyproblems. Oh, sure, the specifics were different.
The problems might concern circuits or automobile parts or oil rigs
instead o f picture tubes, but you just had to change one or t w o words
and their diagrams described one of my problems. For example, there
were problems with supply chain, problems coordinating marketing and
eng ineeri ng, et cetera.
The issues looked exactly the same! It was uncanny. When I saw that
similarity I began to be convinced that there was something here worth
paying attention to.
Bert: So we both were struck by the common patterns we saw in
those experiences. You saw a pattern in the kinds o f business problems
that people drew and I saw a pattern in the way people were reacting to
the system they found themselves in during the game-a system that was
very much like a real work environment.
Iva: Right. I began to see that many o f the problems that we expe-
rience in business are shared; they seem to cut across all industries.
Furthermore, these problems appear to be the result of patterns that we
ourselves continuously create and repeat-even though they lead to
undesirable results!
Once I saw that, I wanted to find the way out. Organizational learn-
ing, I thought, just might be able to teach me something.

Patterns and Systems of Our Own Making

When you first begin to comprehend the power of systems, the
feeling can be overwhelming. As you begin to see how interrelated
and interconnected all the aspects of a system are, you can begin to
feel powerless to make improvements, especially if you perceive the
system to be dysfunctional. However, this initial realization can be
tempered by a further realization. Gradually, you begin to see how
your individual thoughts and actions help to create the systems in
which you find yourself. Once you understand and accept that you
10 Part 1 / T h e Vision

are also creating the system, your creative energy is freed to create
something new and better. You must then learn how to use that
freed energy to create what you really aspire to.

Iva: There is a way to escape the system that you talked about, Bert.
But before you can escape, you need to understand the system you're in.
You need to realize how the structure of the system influences your
behavior and how your own decisions contribute t o the crises you expe-
rience. If our readers come to understand this, then they will be able to
relate t o organizational learning and perhaps see its value as well.
Bert: We need to share those insights. But even more importantly,
we need to share how we came t o those insights because people can't
get them from reading a book. They're all there in The Fifth Discipline, but
reading about them will only take people so far. I had t o get there by fol-
lowing my own path, making my own discoveries and mistakes, and
relating my own experience to the things I was learning. Our readers will
want to do that also.
Iva: You're saying that there is something qualitatively different
about the way we learned about organizational learning that distin-
guishes it from how we have learned about other things in our careers.
It really has been a journey for me. And it continues t o be a journey.
Bert: Yes, for me also. And so perhaps the best way t o share what we
have learned is t o tell others about the journey we have been on, what
we have discovered, and the questions that arose along the way.
Iva: First, we need t o set the context of our journey.
Bert: And tell the story from the beginning. Because in a way our
stories are every manager's story.

The Well-Traveled Road

To understand both the appeal and the logic of organizational
learning, we must begin further back, tracing the progression of
ideas that led Bert and Iva to believe that organizational learning
is the next evolutionary step for organizations.
To accomplish this, we will take a critical look at several
approaches that are widely used to improve organizations: restruc-
turing or reorganizing, downsizing, reengineering, and TQM.
While these methods often prove valuable, we believe that they
are essentially incomplete and therefore inadequate to the task of
truly transforming organizations. We will discuss why organiza-
tional learning holds more promise.

Iva: As senior line managers in t w o old, established companies, we

have been through the waves of so-called organizational transformation
 Chapter 1 / The Premise and the Promise 11

and many o f the management programs that some consider fads. We are
veterans o f TQM programs, reengineering, and downsizing. And before
that, we often tried to solve problems by reorganizing or restructuring-
usually with very mixed results.

First Stop: Reorganizing

Bert: We've been using reorganizing and restructuring as strategies
for solving problems for ages. Of course, there are times when restruc-
turing or reorganizing makes all the sense in the world. Sometimes
changing the external structure can drive us t o be more efficient or cre-
ative-but there are also times when reorganizing is a mistake.
It can be a mistake when restructuring is an automatic response to
a problem. It can be a mistake when we don't search for the underlying
cause of the problem-which can be systemic-and instead try to change
or improve things by rearranging the organizational structure or by
putting different people in the same slots. Generally, that doesn't accom-
plish anything; it just shifts the problem someplace else and creates a
mess in the meantime because we disrupt all the relationships that had
been developed in the old organization.
Iva: Let me give a specific example. In my manufacturing firm, we
had a perennial discussion about whether equipment maintenance
should be part of the equipment group or the production group. Now you
might think the best people t o lead that effort would be the equipment
group. But when that was the case, whenever there was downtime and
more scrap, the people in the equipment group pointed their fingers a t
the production people, saying that the problem wasn't the equipment
but that the production people didn't know how to use the equipment
properly. So then we put equipment maintenance under the production
group.
Bert: On the theory that they're the ones who are going to suffer i f
it's not properly maintained.
Iva: So we moved the boxes around and, lo and behold, when we had
a problem the finger pointing went in the other direction. That was when
we realized that we had a larger issue. We needed t o figure out how to
get these people to work together and stop the finger pointing. It doesn't
matter whether you are part o f maintenance or production or whatever,
if you are part of a process, the most important link you have to estab-
lish is with your internal customer, the guy down the line whose job is
dependent upon your job.
Bert: My experience with reorganizing revolves around the question:
What is the core competency that the organization will structure itself
around? For example, our original structure went back to the days when
we were part of ATBT. We structured ourselves around different technolo-
gies. The impact on us employees was that we spent our careers becoming
experts in one aspect of the business, climbing the corporate ladder in one
12 Part 1 / The Vision

"silo" until we reached a certain level. Then we were shifted around to

other groups to give us a broader perspective of the business.
Some years later we reorganized based on geography. The impact
was that now we had to be technically competent in everything-all
forms of engineering, operations, marketing, etc.-in order to be in senior
management. I remember my boss saying that any person who gets a top
job needs to get a big "5" on his or her shirt because he or she is going
to have to be Superman.
The unintended consequence o f this structure was that fiefdoms
were created. There was very little collaboration between the geographic
regions and the focus was all on the internal metrics. Which geographic
region was better than the other? As a consequence, the customer was
forgotten. This was most evident during natural disasters, when we
needed to loan people from one group to another. The different regions
were reluctant t o do that because it might impact their results.
Sometime later we reduced the seven geographic regions to four, but
that didn't change anything. The competition just got more intense.
Iva: I've had a similar experience with reorganization. Philips has
been organized in a matrix (product/geography) for a long time. We flip-
flopped many times between having more focus on products than geog-
raphy and vice versa, but neither focus seemed to create the results we
expected. That was because of the way we thought about the question.
The question was always framed as, Should we focus more on A or B?
What was missing was a way of understanding the relationships between
geography and products and working with those relationships such that
we could improve the results.
Bert: Most recently, partially as the result of a major downsizing, the
company decided that customer-facing functions were the most impor-
tant, so they structured the company into customer-facing units driven
by marketing. The advantage o f this arrangement was that the customer
voice got much louder, but there was still poor cross-functional commu-
nication. For example, the marketing department would launch a pro-
motion for a product that the operations department did not have suffi-
cient manpower to support. Also, non-customer-facing employees felt
demoralized.
Iva: So we reorganize hoping to get a certain result, but most fre-
quently we don't get the results we intend. Nevertheless, we continue to
look for how t o arrange the boxes, convinced that this time i t will work.
Bert: Well, the Beer Game teaches us that structure influences
behavior. It's almost as if we sense that people placed in the same struc-
ture tend to produce the same results, so we keep trying to produce dif-
ferent results by changing the structure.. . . But I'm not sure that we know
how to go about defining the right structure because we generally don't
understand the root cause of the problem we're trying to solve.
 Chapter 1 / The Premise and the Promise 13

Iva: Maybe there's no such thing as the "right" or "wrong" structure.

Yes, the Beer Game teaches us the power o f structure to affect behavior,
but we shouldn't take that as affirming that all we managers need do is
change the structure until we find the structure that reinforces the
behavior we want. A structure that tends to enable one behavior will dis-
able another, yet both may be important to the business. So we need to
look beyond the structure and think about how we are connected. As the
Beer Game also taught us, how we act and behave within the structure
is just as important as structure itself.
Bert: I don't think business has learned that yet.

A Fork in the Road: The Total Quality Movement

Iva: No, so we keep searching. The TQM movement presented us with
an alternative t o restructuring. In fact, to your point, one essential ele-
ment of TQM work is the search for the root causes of problems. O f
course, American businesses rejected TQM in the beginning. We only
began to embrace the TQM movement after we saw that the Japanese
essentially eliminated the American electronics industry and were
threatening the American auto industry. The Japanese auto manufactur-
ers had been successfully experimenting with TQM for some ten years, so
now we thought we'd better pay attention.
Bert: First there was the fundamental Quality approach with the
basic seven tools of Quality. Then there were the enhanced seven tools
o f Quality. Nobody's against TQM in principle. It's Motherhood and Apple
Pie. But some of the ways in which we tried to implement TQM limited
its effectiveness. Let me give you an example. We got into TQM rather
late-about 1989. We trained thousands o f people in TQM using stand-
and-deliver training. That was the first turnoff. People resented going to
TQM meetings because they perceived it as time taken away from "real
work." We didn't involve the union up front so the union saw TQM as a
ploy to get rid of workers. The TQM teams took forever to get something
done. As a result, there was a lot of disillusionment and very little return
on our investment (ROI).
Iva: Again, there are similarities to my experience. We started our
TQM efforts in the early 1980s. We had t o restart our program several
times because we didn't really understand how t o do it. We learned you
can't copy what other people have done; you have t o figure i t out for
yourselves in your own workplace. Eventually we were able t o involve
everybody-ma n ufact u ring, engineering, finance, marketing- but aga i n
our results were not always what we expected. In one sense we were
successful because the improvements that we made to our product
increased our market share-but then we didn't have the capacity in our
factory t o meet the demand so we weren't able t o achieve a return in our
investment in Quality.
14 Part 1 / The Vision

Bert: Our TQM efforts were focused on our internal issues rather
than on customers and, for me, TOM has to include customers. Yet, very
often when I heard people refer to "Quality" they were actually referring
to production quality using statistical process control. In my view, that's
quite a limited view of Quality.
As a result of this limited view, being rated number one in "Quality"
did not necessarily mean that you had business success. The fact that i t
is necessary, but not sufficient, to have Quality was not understood by a
lot of people. I believe that IS0 9000 is in the same boat.
Iva: It's worse.
Bert: It's worse because it doesn't involve the customer. IS0 9000 is
a "say-do" verification. Basically, with IS0 9000 you go through a process
of saying, "This is what I say I do. This is what I do. Here's the documen-
tation to prove it. You can come and audit me." It says nothing about
whether or not what you're doing is appreciated, valued-
Iva: Or useful.
Bert: Or useful. Or whether there's a market for it, or whether it's
customer-focused, or anything. So you could be making buggy whips-
things that customers have no use for-and still be IS0 9000 certified.
Iva: IS0 9000 is, I would say, only an entry point into TQM.
Bert: Right. IS0 9000 essentially documents the processes and guar-
antees that you do what you say. It doesn't say anything about whether
or not you're meeting market needs. So, for reasons like that, I was one
of the TQM people in my company who felt that Quality didn't do
enough. I began to feel that there was something missing from the TQM
movement.
Iva: I shared that perception. I, too, was looking for something more.
I felt that people were not able to truly engage with the TQM effort.
There was something missing.

A New Vehicle: Reengineering as Strategy

Iva: I want to expand on what you said, Bert, about how IS0 9000 did
not include the customer by talking about the next important trend, reengi-
neering, because there's a connection. Reengineering promised improved
efficiency that would quickly show itself in improved business result^.^ I
never really took this path because we understood that reengineering was
just a camouflage for cost reduction via elimination of people.
Bert: We got into reengineering via activity-based costing (ABC).8
We hired a consultant group to translate our processes into ABC, but
then they said that we didn't really have our processes identified and
that we had about 40 percent rework. So we adopted reengineering as
the way to deal with that. The consulting firm convinced upper manage-
ment that they could reduce some of our costs within the year. In fact,
they promised three times the ROI so, of course, we went ahead.
 Chapter 1 / The Premise and the Promise 15

The problem was that everybody understood that we were using

reengineering to drive our costs down, but the official position was that
we were using it to improve our customer positioning. As a result a lot
of people became disenchanted with what they called "the big lie."
People viewed it as a program that was driven from on high and they
didn't feel that there was much attention being paid t o the employees.
Projects were stopped in the middle of their tracks and people didn't
know what they were going to be doing next. Also, people suspected that
it would lead to downsizing. And sure enough, that was the outcome. It
led to downsizing big-time.
Iva: We learned some things from the reengineering experience. The
reengineering premise-which is now commonly accepted-was that in
order to create value for the customer, we need to refine our business
processes t o ensure that the customer receives what he or she desires. So
we believe that a business's processes must be aligned with the external
demands of the market, i.e., customer demands. It is equally important
that the internal processes o f the company be aligned with each other.
The field o f process management deals with creating such processes,
modifying them in accordance with agreed-upon expectations and mak-
ing them efficient. This is where reengineering enters in, because exist-
ing business processes often have to be "reengineered" in order to make
them more efficient and effective.
Now here's where there are some parallels between IS0 9000 and
reengineering. While IS0 9000 failed t o take into account the customer,
reengineering failed to fully appreciate the role o f people as human beings
in relation to the processes that were to be reengineered. Often reengi-
neering led only t o downsizing, with its positive effects on business
results and negative effects on people. Let me be more specific. When
processes were found to be inefficient we would reengineer them to
make them more efficient. This often led to downsizing because some of
the people who worked on those old, inefficient processes were dis-
placed. It was the downsizing that often resulted in quick, short-term
improvements to business results, so we in management tended to focus
on finding those opportunities to downsize.
Now a problem arose because in order to understand those processes
we needed t o interview the people who were involved, but many times
people were afraid to tell the truth because they knew that they might
lose their jobs if their part o f the process was redundant. So, often with
the best intentions, we in management set up a situation where we
would actually punish people for their honesty.

Consequences: Downsizing as Strategy

Bert: Yes, and that's how downsizing started to become the strategy of
choice for a lot of companies. In most cases, you couldn't get the cost
reductions that reengineering promised without doing workforce reduction
16 Part 1 / Th e Vision

because that's where most of your expenses were. Essentially, you couldn't
get there from here without downsizing.
Let's talk about downsizing as a strategy. Whereas the image left by
TQM was that progress takes forever, downsizing got financial results
fast. That was very attractive given where we were in the evolution of
the "Big Squeeze." It's ironic because other countries were doing better,
including Japan, which had embraced TQM, and they were putting
squeezes on us.
Iva: Downsizing was the tragedy of our business as well. I have had
to do a lot o f downsizing in my career because traditional cost reduction
programs in manufacturing tend to involve workforce reduction, almost
without exception. The thinking is straightforward. When our labor cost
as a percentage of total cost was higher then our competitors, we had to
act on it. That often meant reducing the number of jobs.
The reason for that is quite simple: If we have fewer people on our
payroll, our payroll cost is less. Unfortunately, it is not as simple as it
seems. The cost of labor (both fixed and variable) depends not only on
what we pay for the labor per se (i.e., your labor cost); it depends even
more on how good a job labor does.
This is where our traditional ways o f measuring things breakdown.
Assessing how good a job labor does requires an entirely different way o f
accounting for labor. We are beginning to evolve some more sophisticat-
ed ways o f looking a t labor cost. For example, Activity-Based Costing
provides a methodology to make those assessments, but that methodol-
ogy requires that we first understand the business processes and improve
upon them, so we can achieve the best efficiency through reengineering.
In the past, however, the only thinking management knew how t o do
was t o give directives to reduce the percentage of labor costs-which
essentially meant the percentage of people employed. Then, o f course,
Hammer and Champy made their contribution: Reengineering told us
how to select the jobs t o be eliminated.
Bert: Companies that did reengineering became too focused on
downsizing. Reengineering was supposed to be about cost reduction. The
theory behind reengineering was that we could do many of our processes
more cost effectively, but many of us in management equated that with
reducing the workforce. As a consequence reengineering often became a
cost reduction strategy that was put in process terms. Many times we
really weren't looking for the best processes.. .
Iva: Right, the focus on process in reengineering provided a kind of
camouflage for cost reduction.
Bert: We reinforced that when the success factors we defined for
reengineering were all geared t o cost cutting. So, if a process was better
but cost more, it probably wouldn't have seen the light of day.
Iva: Exactly. And the thing that is so striking is that we were in t w o
different companies in t w o different industries-telecommunications and
electronics-yet the experience was essentially the same. That tells me
 Chapter 1 / The Premise and the Promise 17

that our management practices have created a systemic structure that

makes certain types of things happen.

How We Create Results We Don't Want

Iva: For example, when we embark on a program like reengineering, our
goal is to improve processes. We also have an underlying goal, which is to
reduce costs, but when we announce the program to our people we tend to
paint it in the best possible light. We tell them it's about customer service.
Now, of course, they've already jumped ahead and anticipated the impact,
so when it comes to describing processes they're afraid to be completely
honest because they know i t could mean their jobs.
So now we have all created a situation in which there is a good deal
of distrust-and the results that we create are not the results we want.
Why is it that we in management act in these ways?
Bert: We tell people we need to do these things in order t o remain
competitive and for the good o f the business because we believe it and
we see it as our only alternative. We really believe that the competitive
realities and customer requirements are such that we need to do this for
the enterprise to survive and for most people to preserve their jobs. We
also believe that if our costs are reduced customer demands will be
enhanced.
The reality is, however, that certain functions are targeted and the
people who perform those processes are a t risk. But we tend t o smooth
over that information. Why do we do that? It's because we don't want t o
confront the inevitable questions: Which people will be affected? When?
How many? We don't want to confront those questions because we don't
know the answers yet. So we don't say anything. But since nobody's talk-
ing, imagination takes over and people get very defensive. Yet, as man-
agers, we truly believe what we're saying and we feel that we are acting
in the best interest o f the whole.
Iva: So, we create a system that compels us to act in certain ways.
We contribute t o creating outcomes we don't want because we can't
admit that we don't know something. We have been trained to create
these structures without questioning the value o f them.
Bert: This happens because we have a limited ability t o envision
alternatives. And this is where organizational learning can help-we can
learn to seek other alternatives.
Iva: But until businesspeople come to that essential realization,
there's not much that will change.
Bert: Perhaps the business community is starting t o get a sense o f
this. Take what happened with reengineering. Many organizations that
had gone through reengineering started having problems. Then came the
criticisms. The big criticism of the reengineering process was that it left
out the needs o f people.
18 Part 1 / T h e Vision

Even the purported guru of the reengineering movement, Michael

Hammer, seemed to acknowledge this when he came out with a new
book, Beyond Reengineering.9 Even he recognized that something was
awry.
Iva: If you look back and reflect upon what we have been seeing, you
come to the conclusion that the problem is that we in business are
always looking for the silver bullet. That's often why we seem t o be fol-
lowing fads and implementing "another fine program," only to drop it
several months later.
Bert: That's how we get ourselves in trouble.
Iva: Not only do we keep looking for a silver bullet, but when we
think we find one we implement it in a way that actually diminishes its
likelihood o f success. For example, let's look at reengineering again. I've
read that 80 percent o f all companies that tried reengineering didn't
make lasting improvements. Now people say that's because reengineer-
ing doesn't work.
I have a theory about that. When a company says, "Let's reengineer
our practices," or "Let's do team building," they're acting as if they know
that those strategies or tactics are going t o do something positive. But
they are not really speaking from knowledge. They're talking from opin-
ion or conviction. In our American culture, strong belief in an idea is
often confused with knowledge.
When you look a t the actual documented evidence about this ques-
tion, the results are all over the map. So what we really know about busi-
ness management is actually very equivocal. We advocate many o f these
management tools and practices because o f our conviction about their
value, but we don't really know. We don't have a research base that tells
us whether some tools are better able t o solve problems than some other
tools.
Bert: We also don't accumulate knowledge very effectively, so when
we find that our silver bullet o f the month didn't yield the results we
expected, we have a tendency t o throw the baby out with the bath water
rather than investigate further.
Iva: And then we're on t o the next thing. I believe that in each of
these cases we failed largely because of the way we went about imple-
menting the programs.
Bert: Oh, absolutely. We forgot about the needs o f people.
Iva: Worse, we didn't know how to engage them. Look a t process
reengineering. The precursor to reengineering was industrial engineering
(IE). IE helped us refine processes, but it looked at the people involved in
processes as just a set of hands. In fact, when we mapped the process
we'd use the icon o f a hand t o show that a person was involved. IE only
looked a t discrete processes. Then reengineering came along and helped
us look a t an entire set o f processes across our organizations, but we
didn't get much better a t taking human beings into account.
Reengineering, for example, has t o be done collaboratively with the peo-
 Chapter 1 / The Premise and the Promise 19

ple who are part of the process. If we took an organizational learning

approach t o reengineering we might learn how t o improve processes
while also including the needs o f people.

Is There a Different Path?

To this point, we have been following a logical trail. The argument
for organizational learning largely rests on the idea that, when
analyzed rationally, many of the alternative management
approaches to change and improvement have been deficient in
one way or another.
There is another argument, however, and it is more personal.
It lies in the personal experiences of managers who have had to
make sense of the human aspect of organizational management.

Bert: So there we were. As we participated in all these waves of

management theory we apparently both began to sense that something
important was missing. Both o f us were experienced managers, very
practical, and a little cynical, perhaps. . .
Iva: Maybe you were cynical, Bert, but I was neither cynical nor
doubtful. When the doubts came, I always found a way out of them. I
always found a way t o go over barriers or around them. That's what made
me successful in my career. I was seen as tough and decisive. But about
the time I became the president of my firm I was beginning to see things
a little differently. As I began to assess the situation I saw that a lot o f
tough decisions were going t o have to be made. I didn't know how t o
avoid them.
For example, the company that I was heading needed a major over-
haul. It had been neglected by its previous parent company for a long
time and as a result it was woefully behind the times competitively.
When we acquired it, the company was riddled with inefficiencies and it
lacked both modern technology and people with technical competence.
We were a badly outdated American manufacturing company that was
suddenly acquired by a European conglomerate and expected t o compete
effectively in an increasingly global economy.
When I was put into the job as president I was expected t o turn the
company around. I had always been a high performer, so I knew I was
going to succeed in accomplishing this. But I could not figure out how t o
deal with these problems and a t the same time preserve the jobs, pre-
serve the people in the jobs. M y excuse was that in order t o save the
most jobs, something's got to give. This is a typical and normal reaction
of all executives. We rationalize our actions by saying that we're going
to save the majority o f employees, but we're going to get rid o f some.
I was a new president and I had never done this kind of thing before.
I saw the logic of it, but what was difficult for me was that I began to
20 Part 1 / The Vision

make certain connections in my mind. I began to see connections

between downsizing in this plant and how it would affect the community,
the larger company, the whole country, and even the entire world.
You know how in chaos theory we say that a butterfly flaps its wings
in the Amazon and there's a storm in China? Well, I was making these
connections in my mind, but they were not obvious to many people, so I
was struggling for a way t o make them clear to others.
I could not come up with any other solution. Finally I said, "This is
how it has to be. Some people are going t o have to go." Once I came t o
that conclusion, I wanted t o make sure that when we did reduce the
workforce we were as clear as possible about the criteria for who stays
and who goes.
Bert: We had a similar experience. We were under extreme pressure
to reduce our costs dramatically. Our labor costs were 70 percent o f
expenses and our reengineering efforts pointed t o downsizing. The pres-
ident announced that we were entering into a four-year program with
the goal of downsizing 10,000 people. We had downsized before but
never had there been a corporate objective with a specific number
attached.
That experience with downsizing was something I was never able t o
rationalize to myself-for a variety of reasons. I remember that we felt
that the downsizing was not going well. We tried to do it humanely, via
the early-out process, but this quickly degenerated as the best people
started leaving. We then had to create some work-arounds t o keep good
people in some key positions. Everyone knew about these "secret"
arrangements, so there was a lot of resentment. Productivity declined
and the whole culture began to change. For example, line people were
seen as valuable because they interacted with customers, whereas staff
people were not valued.
More than that, we were sacrificing service at the expense of cost. I
stood for the idea that you could do both-but you have to bring service
and cost together in a way that makes sense. Yet, we kept reducing costs
so much that we were "cutting into the bone." That's the phrase people
used to describe what was happening. So we were in the process of
downsizing 10,000 people and cutting costs and we were having cash
flow problems. We eventually got bought out. Then, the new manage-
ment hired 2,000 people.
Iva: That is a typical story of a typical enterprise.
Bert: Your ability to build the competence o f your organization also
suffers whenever there's downsizing. You may actually downsize only 10
percent o f the organization, but you absolutely jeopardize the 100 per-
cent because then everybody is fearful. You can't get quantum positive
changes when everybody's acting out of fear. Most businesspeople
believe that growth is fundamental to business, but downsizing is a
recipe for retraction rather than growth.
 Chapter 1 / The Premise and the Promise 21

Iva: Organizations are not machines, they are living things. That's the
premise that Arie de Geus'O is promoting, the idea that a company is a
living organism and that we should be interested in actions that are life-
giving, that enhance the life o f the organization. I can see how you'd say
that downsizing is not life-enhancing, but you could also say that down-
sizing is like pruning the tree-that cutting back now will help the busi-
ness to grow later.
Bert: Yes, you can make that argument. But that argument only
works in the abstract. When you're actually making decisions that affect
people's lives you feel differently. I mean, hopefully, you feel differently.
What happened in my company when we were downsizing was really,
I think, wrong. I believe that the leadership team ought to show more sen-
sitivity and share the pain. For example, the CEO of Netscape decided to
forgo his salary for a year when profits went down. There needs to be
more of that in business. I say we forgo our bonuses, we forgo our perqs
if we're downsizing.
It's not that we're going to fall on our swords because we have to
downsize, because we still have a job to do. But we should make the
point o f solidarity with this whole process.
Iva: I would agree. I would say that was the guiding light for me. I
hated t o downsize, but I believed that I had no choice. I had lack o f com-
petence. I had swollen budgets. We were losing money. I had t o move the
company. All of these things are not pleasant t o people and their fami-
lies. But when it was all said and done, I did not hear a lot o f criticism
about how i t was done. And then, with time, people realized my inten-
tion. I did not have t o say we're not going to have layoffs any more. It
was expected that I would work toward creating conditions so that we
didn't have to lay off people. And we didn't.
Bert: I always thought there's got t o be a better way than downsiz-
ing. There'sgot to be u better way. And that was the ethic that drove my
interest in Quality. I thought there had to be a way t o connect our per-
sonal values with our business goals.
Then I encountered a new concept: organizational learning.

Endnotes

1. Peter Senge et al., The Fifth Discipline Field Book (New York:
Doubleday, 1334), pp. 6-7.
2. David Whyte, The Heart Aroused: Poetry and the Preservation of
the Soul in Corporate America (New York: Currency/Doubleday,
1334), p. 231.
3. For more information on "The Beer Game" see Peter Senge,
The Fifih Discipline: The Art and Practice of the Learning
Organization (New York: Doubleday, 1330), p. 40.
22 Part 1 / The Vision

4. Senge, 1330, op. cit., "More on the Beer Game," pp. 27-54.
5. Senge, 1330, op. cit., p. 68.
6. Senge, 1330, op. cit. In Chapter 5 "Shifting the Mind," Senge
introduces systems diagrams (or causal loop diagrams). To
learn more about practical application see: Anderson,
Virginia, and Lauren Johnson, Systems Thinking Basics
(Cambridge, MA: Pegasus Communications, 1337).
7. For more information on reengineering see Michael Hammer
and James Champy, Reengineering the Corporation-A Manifesto
for Business Revolution (New York: HarperCollins, 1333).
8. For more information on activity-based costing see Gary
Cokins, Activity Based Cost Management, Making It Work: A
Manager's Guide to Implementing and Sustaining a n Effective ABC
System (New York: McGraw-Hill, 1336).
3. Michael Hammer, Beyond Reengineering: HOW the Process-
Centered Organization Is Changing O u r Work and Lives (New
York: HarperCollins, 1337).
10. Arie de Geus, The Living Company (Boston: Harvard Business
School Press, 1337).
Chapter 2
The Dilemma
Iva: Through systems thinking I learned to see things differently. For
example, our lenses, the mental models through which we view the
world, tell us that the cost o f labor is simply a function of the size of the
labor force. So, i f we lay off some workers, we have a resulting cost sav-
ings. What could be simpler?
This is what virtually everyone in my company seemed t o believe.
However, I had a very different picture in my mind. I knew that our labor
costs were primarily caused by the problems we inherited when we
bought the business, including legacy machines, substandard technology,
and poor labor relations. All of these things contributed to high labor
costs and none o f them were going t o change i f we merely reduced the
number o f people we employed. I knew these things intuitively, but I
lacked a method for more deeply understanding and expressing these
relationships.

A light in the Tunnel

Iva: Then I learned how to look a t the world through the lens of sys-
tems dynamics. When I looked at our situation through that lens, I began to
get a more profound understanding of the various relationships. For exam-
ple, I saw that there was a relationship between labor costs and the effi-
ciency of the labor practices mandated by the union. That led to an "Aha!"
I saw that if we laid people off we actually ran the risk of increasing our
long-term labor costs.
Here's what really happens: If I lay off workers, the union's trust of
management is affected. This distrust creates an antagonistic relation-
ship between union and management which, in turn, makes it harder for
us to reach agreement next time. Without the ability to reach agree-
ments with the union on labor practices, these labor practices can
become less and less efficient. Eventually those inefficiencies can out-

23
24 Part 1 / T h e Vision

weigh any cost saved by decreasing the size of the labor force. So my
action actually exacerbates the problem rather than relieving it. That was
a very powerful revelation.
Bert: I had a very powerful realization about systemic thinking also,
but it was a little more prosaic. Ever since I was a kid, I've been a fan o f
The Three Stooges. There's a sequence where the stooges are trying to
close all the drawers in a bureau. They push in one drawer, and another
pops out. They push in t w o drawers and the third pops out. That scene
popped into my head and suddenly I realized that that's a perfect
metaphor for systems thinking.
We try to fix something in the system, but we fix i t here and it pops
out there. We improve the cost structure o f one department, but then we
find that another department downstream has absorbed the impact o f
that cost savings. For example, we try to save costs by not using certain
forms, but then people do extra manual work in another department
because we don't give the forms to them anymore. Then it dawned on
me-there's the system! We should all ask ourselves: What do our three
drawers look like?
I kept that analogy in mind when I tried to explain to others why I
thought that TQM was insufficient. I talked about how TQM deals with
improving processes whereas systems thinking gives you tools for look-
ing at the whole and all of the interrelationships. Systems thinking can
help you examine whether or not the process you're trying to improve
should exist in the first place.
Iva: I thought I saw the light with Senge's work. I thought that I
could find a different path. There came a time when cost reduction wasn't
working, you see. We reduced the cost, but then suddenly we couldn't go
any further. We were in a commodity business, and the prices that our
customers were willing t o pay for our products kept going down. The
most we could do was just keep up with that. We began t o believe that
we could never make more money. In short, we were desperate . . . and
maybe that's why we were able t o consider a new perspective.
Having traveled down this road for so long with TQM, IS0 9000, and
reengineering, I felt I knew what was missing. I began to feel strongly
that if you align your business processes with the vision you have for the
company and really understand how this alignment works, you will find
where the added value is and where it isn't. That was something that
reengineering couldn't give me. So I began to think that if I brought
organizational learning tools together with reengineering then maybe I
could create a new strategy that would improve business results. I called
that strategy "process recreation."
Bert: What resonated with me about the organizational learning
approach was that learning brought people back into the equation. From
all accounts, learning is going t o be the competitive advantage o f the
future. That only makes sense. If you can learn faster than your com-
 Chapter 2 / The Dilemma 25

petitor you will survive and prevail. And because people are the only
rational animals, learning must involve people. You put those two
thoughts together and you say, "Oh!" You get to the natural conclusion
that we ought to move toward organizational learning. That's the path
that my thinking followed.
Then I thought, organizational learning can accomplish the same
thing as downsizing, but it keeps the people in the equation. Let me
explain.
The assumption behind downsizing is that the function under
inspection can be done more efficiently. If you apply systems thinking t o
the same problem, you might come to that same conclusion. But systems
thinking can also help you see where you have the potential to expand
as well as downsize. With a systems thinking approach we can stream-
line a process, and then actually help people move to other places where
there is potential for growth. So, while you are downsizing a specific
function, you can also grow the enterprise.
If we were able to demonstrate how organizational learning can cir-
cumvent the downsizing strategy, it would be considered a very valuable
tool-because downsizing is the tool of choice these days. But downsiz-
ing has a very debilitating effect on the organization that does it, and
that effect is not well understood.
Iva: Downsizing is the result o f inappropriate planning for the future,
or put another way, downsizing is the result o f an inappropriate way of
creating the future. Specifically, I mean that we resort to downsizing
because we want to rebuild for growth. We want to create something
new. We want to take advantage o f new ideas and new technology.
Organizational learning has the promise o f helping us to create a future
in which there would be much less need for downsizing.
Bert: That's true. That's true. With systems thinking in particular you
take into account more o f the various forces that are influencing the sys-
tem. The more you understand about the system that effects what you
are dealing with, the better you're able to anticipate results and changes.
If all of the forces are respected, you have a better chance of selecting
the most advantageous leverage points and, thus, making decisions that
will have the most positive impact on the organization.
Royal Dutch Shell is a very good example. They engaged in a prac-
tice known as scenario planning which enabled them to consider a vari-
ety o f different possible futures for their company.' As a result, they were
quite well prepared when the oil crisis occurred. So, the more you are
able t o look into and understand the system that you are a part of, the
more you will be able t o move in accordance with the forces a t work in
the system.
In short, we are suggesting that there is another way t o look a t how
to create the future. It would be too utopian to suggest that we will be
able to create the future without ever needing to downsize. But, by using
26 Part 1 / The Vision

systems thinking to expand your understanding o f the context in which

you are operating, you may arrive a t a different future-a future where
you might not need downsizing.
Iva: It's more than that. Through learning we may come to better
understand how to manage in difficult times so that we are no longer
jumping from solution to solution, looking for the next silver bullet.
Instead, we understand what is most likely t o work when and why.
Organizational learning increases the possibility of our creating more
effective companies. Organizational learning is a way of thinking about
how to create the future.
Bert: When you look a t it that way you see that each of the man-
agement programs from restructuring to quality t o reengineering t o
downsizing was not really a fad, but rather an incremental step on the
path. Each step accomplished some things, but left out others-particu-
larly people.
Iva: Let's summarize our thinking. (See Table 2.1.)

Table 2.1
Potential Benefits and Pitfalls of Management Methods

Methodology Potential Benefits Potential Pitfalls

Reorganizing, restructuring Can stimulate creativity Can be a "quick fix"
that does not address
Focuses on core the real problem
competency(ies)
Destroys existing com-
Enhances control and munication paths
communication in
some areas Can make it harder to
get commitment next
time
Quality Finds root cause of Takes a long time
problems
Does not identify
Reduces cost of unnecessary processes
processes
Does not reveal
Free (over time) systemic structure
Does not explore all
relevant interrelated-
ness
Reengineering Streamlines processes Does not engage
people in the
Cost savings organization or take
into account the effect
Fast ROI on people
May not lead to lasting
improvements
Generally leads to
downsizing
 Chapter 2 / The Dilemma 27

Downsizing Reduces labor cost Unintended conse-

Organizational Learning
quences to organiza-
tion [demoralization,
paralysis, etc )
Can involve people in Delays in obtaining
the organization in results
creating the results
they truly want Difficulty in measuring
effectiveness
Results can be sustainable
Requires multiple
Can facilitate restructur- change agents
ing, reengineering, and [executives,
Quality-perhaps avoid networkers,
downsizing line management)

Bert: If you look a t it this way, organizational learning is the next

logical step. Organizational learning can help shift our sensibilities and
provide tools and methods, such as the five disciplines identified by
Senge, that can help us bring people back into the equation-not just in
a humanistic way but in a very practical and effective way.
Iva: If we take an organizational learning approach I believe we can
avoid the mistakes and the unintended consequences that we both expe-
rienced when we tried t o implement the other programs.
Bert: The reason that we were drawn t o organizational learning is
that we both subscribe t o the same value proposition-that people make
a difference. And in a business context, people are our only sustainable
advantage. Our career paths may have taken some different turns, but
the unifying thing is that we both fundamentally believe in the capabil-
ity o f people in the business environment.
Iva: Organizational learning spoke t o that essential belief.

Three Addition a I Arg u ment s

Iva: There are a number o f additional very solid arguments for why
organizational learning is the next logical evolutionary step for businesses
t o take. Let's develop that value proposition.

Argument # 1: The World Is Changing

Bert: We are beginning t o realize that the ability t o learn and act
quickly in the right direction is an important advantage, especially if you
can do it better than your competition. The ability t o meet changing cir-
cumstances and conditions that happen around the world is a function of
being able to learn quickly and t o act based on that new learning. If you act
irresponsibly or unintelligently, you pay the supreme price. You lose your
company or you lose your job.
28 Part 1 / The Vision

Furthermore, Arie de Geus has argued, rather eloquently, that learn-

ing may be the critical economic factor in the future.* He bases his argu-
ment on a historical analysis of economics. Economics is based on three
factors: land, capital, and labor. Land was the dominant factor centuries
ago as we saw in the establishment of empires and feudal systems. Then,
with the Industrial Revolution, came the dominance of capital.
Now we are seeing the rise of labor in the form of the knowledge
worker. If we view labor as the knowledge worker, and the creation of
greater knowledge as the way of the future, then the winners will be
those who master the application o f competitive knowledge and apply i t
quickly and skillfully. In other words, learning faster and applying that
learning faster is the key t o competitive advantage. It follows that the
competitive advantage for the foreseeable future is going to be obtained
through people. That view can't be given simply lip service anymore, for
the reason I just stated. We have to realize that people have options and
choices, and that changes in their value systems can make a company
fantastically successful-or sink it.
There is a further implication to this argument: that the future suc-
cess of business demands a greater integration o f individual goals and
business goals. At present these sets of goals are actually interdepen-
dent, but they exist in a kind o f tension with one another. That tension
is relatively stable, a t least in most situations most o f the time. But as
we continue to globalize, t w o things will happen. Globalization will
intensify the interdependency of those goals, and the rapid change that
accompanies globalization will exacerbate any apparent dissonance
between individual and business goals.
Consider the increasing evidence that the work ethic is changing. It
used to be that your job and your company were your life. That's disap-
pearing. Gary Heil, a management consultant, says that people are refusing
to work overtime, refusing to move, and refusing to do the things we used
to think companies had the right to demand. Now the integration of per-
sonal goals, free time, and family things with work is a priority. Many peo-
ple are no longer willing to accept the company doctrine of "we need you
to be here and to do what we say."
Today, many workers-certainly not all, but many-have more options.
Many seem to have a relatively high disposable income. They're willing to
job-hop like crazy. Downsizing has done a lot to erode loyalty to impersonal
corporations. There's a whole demographic change. And there's a lot of
entrepreneurship, which means that people are willing to take more risks
because they recognize that if they have a better idea or i f they can do
something faster, they can go in a garage and create a company.
This tension between personal and organizational goals will have t o
be resolved because the system can only hold so much tension for so
long. The question is will we be able to resolve i t in the direction o f
 Chapter 2 / The Dilemma 29

greater harmony, synthesizing into something powerful and mutually

rewarding, or will we create some sort of catastrophic separation?
Iva: We live in a democracy, but that applies onlyto our form o f gov-
ernment. Businesses are neither democratic in their structure, nor demo-
cratic in their behavior. Our economic system is capitalism with a free
market economy. Business behavior is governed by competition, not col-
laboration; we think in a winllose context, though we advocate w i d w i n .
Win/win is easy when there is enough to go around for everybody to get
what he or she wants, but that happens very infrequently. Our mental
models tell us that our resources are limited, and we in business are driven
by the demands o f capital and other markets. This is why it will take
much more work to change what you are describing, Bert.
Let me give you an example. Because we live in capitalism and
because we have Wall Street determining the value of our work, we can-
not ignore the processes that exist on Wall Street which assess what is
good and what is bad. In my judgement those processes and tools need
updating. For example, we talk about people as being assets, but we treat
them on the balance sheet as if they are liabilities. To make the assets
capable of continuing t o produce value, we need t o make investments in
those assets. If people are considered assets, why is training not consid-
ered an investment, but a cost?
Wall Street uses primarily financial measurements t o assess the
value of the business, while businesses are already expanding those mea-
sures by adding other nonfinancial measures. Many of them came about
through the TQM efforts. The next thing that needs to happen is the
development o f tools and measurements that would more effectively
assess the contribution that people make in value creation beyond that
which is measurable today.
I suggest that we devote focused time to reflecting on this subject.
But before we do that, there are a lot of other things we need to clarify.
I am suggesting at this point only that practicing, researching, and
increasing the capacities of organizations t o learn will create the
answers we are searching for today.
Many of these things are in the process o f changing, and the ques-
tion is not will it happen, but when will it happen. So the questions for
me-and perhaps for all of us-are: How much risk do I want to take? Do
I want t o be a pioneer who gets the first mover advantage, or a settler
waiting for others to take the first hit?
Bert: What you just said, h a , provides a compelling reason, a burn-
ing platform, for organizational learning.

Argument # 2: Igniting the Resource Within

Iva: Gary Hamel authored the lead article in an issue of the Sloan
Management Review3 The topic was strategy. The theory Hamel puts forth
30 Part 1 / T h e Vision

is that business strategy is best developed by integrating the technology of

the business with the capability of all the people within the company. You
won't create an effective strategy by bringing in some consultant company
from the outside to develop it, he says. Your own people should be engaged
in developing it. I see this as another signal of something that is happening.
Here is where learning and tacit knowledge become a core competency-a
competency that will be difficult to beat because it's embedded in the orga-
nization.
Bert: That's an important point that you made. It's going to require
someone on the inside t o develop the potential that is already there. It
isn't going to happen by hiring a bunch of consultants.
Iva: Because the resources you need are already in your organization.
You just have to figure out how you are going to get those resources to
surface. You have to find a way t o engage your people so that they are
willing and happy t o participate-and that can only happen when they are
committed to a vision that they care about. Because it's all connected.
That's where the tools and methods of organizational learning
become a vehicle to make that happen. Organizational learning can help
you develop a shared vision and can help you t o surface the potential
that's already within your organization.

Argument # 3: The Value o f Simulations as

Infrastructure for Collective learning
Bert: Organizational learning says that business organizations ought to
be able to learn just as children learn. After all, businesses are collections of
people. But first we've got to put the infrastructure in place to help us do
that collective learning. Simulations could provide some of that infrastruc-
ture. I'm very optimistic about the potential of computer-generated simu-
lations in the business world, because you can play with variables in a safe
environment and learn the consequences of your actions without running
the risk of losing your job or your company. The way we're doing things now
in the business world is too costly. That's why it's so important that we take
these tools seriously.
Iva: We know that Boeing can t e s t an airplane today without ever
flying it, because everything is tested on the computer. They can simu-
late the plane taking off, flying, and landing without ever actually leav-
ing the ground. With a simulation, you can practice without pressure
because if the results are negative, they're only on paper.
Bert: You wouldn't think o f building an airplane without simulating
the performance o f your simulator design. You wouldn't think o f putting
a pilot into an airplane without running him through a flight simulator.
Yet we don't use simulations t o help us make better business decisions.
That robs us of a chance to learn about the dynamic relationships that
affect our business and it robs us of the chance to test out the thinking
 Chapter 2 / The Dilemma 31

behind our strategies. So we have a hard time learning because by the

time we find out that we made mistakes in a major strategy decision, it's
too late.
The disciplined thinking that goes into designing a simulation is an
excellent way t o learn about your business. It forces you t o define a set
o f parameters-or assumptions-and then you must define what the
inputs are and what the outputs should be. If you haven't got all o f that
defined, then you don't know what t o do when the output is different
from what you expected. And, therefore, you don't learn because you
can't correlate your input w i t h the output you saw. You can't see that a
certain delta in input yields that delta in output.
We ought t o be building more simulations based on systems think-
ing principles. We ought t o be incorporating that learning into the way
we run the business.

In the arguments that Bert and Iva have put forth, organiza-
tional learning can be seen as the next logical, evolutionary step in
management practice. Theoretically, organizational learning tools
and disciplines can greatly facilitate current management prac-
tices, such as restructuring, reengineering, and TQM by enabling
people to understand the systemic nature of their business and
providing tools and methods for working more effectively with
those relationships. In so doing we may be able to improve prof-
itability without harming people. Moreover, organizational learn-
ing can support organizational goals by involving people in the
organization in creating the results they truly want-results that
are sustainable.
Organizational learning holds great promise for greater com-
petitive effectiveness through improved learning on a collective
scale and for a more honest, life-affirming, energizing workplace.
Yet, organizational learning concepts and practices have not been
widely embraced. There appear to be significant barriers to its pro-
liferation.

Reaping the Promise

Iva: So why are we in business not doing more with organizational
learning? Why are we not taking advantage o f all the work that's been done
in simulations? Why are we not taking advantage of all the work that's been
done in organizational learning in general?
Bert: Well, now comes the more difficult task. Now we have t o take
a hard look a t our current reality.
Iva: Ah, but we have come upon another o f the tenets o f organiza-
tional learning-that it is not enough t o have a vision o f the future, no
matter how wonderful that vision might be. We must also do an unblink-
32 Part 1 / The Vision

ing assessment of current reality. Our minds tell us that will automati-
cally kill the vision, but what it will actually do is set free the creative
energy so that we can create the future.
Bert: That's the theory, anyway.
Iva: What better way to test the theory?

Current Reality

Bert: Despite the commitment of a few companies, if we look closely

we arrive a t the conclusion that this transition from traditional organiza-
tions to learning organizations is not yet working. The body of knowledge
around organizational learning-which is deemed to be valuable and impor-
tant-is not translating into mass adoption.
We have to understand the reasons why so that we can be as suc-
cessful with organizational learning as we were with the quality move-
ment-but also so we can avoid the pitfalls that we encountered with
quality. We don't want to have t o lose an entire industry to another
country before we figure out that learning is important.

Compatibility Between 01 and Current Business Thinking

Bert: One possible barrier is that the approach, sensibilities, and meth-
ods associated with organizational learning-for example, systems thinking,
shared vision, mental models, personal mastery, or dialogue-can seem
somewhat exotic or inaccessible. They don't always fit easily within the
context of most business environments. Is it possible to demystify these
ideas so that they are more easily accessible to everyone in the business
environment?

The Change Agent's Challenge

Iva: Another dilemma, ironically, is the sheer appeal of these ideas.
Businesspeople who are stirred by the elegance of the arguments for orga-
nizational learning may become swept up in the exuberance of possibility.
As the work and the learning engage them more fully-and, as we both
know, the learning is compelling-people involved in organizational learn-
ing may find themselves separating from others in their organizations. They
may feel that they have answers and knowledge that others do not have.
They may become converts or advocates. In time they may eventually find
themselves in difficult, if not untenable, situations. They may find them-
selves pushing their newfound idealism on a resistant organization.
Bert: They also might find themselves feeling very uncomfortable,
caught between the world of vision and the practical world o f current
reality. In their excitement, leaders may be pushing for change. Then they
meet up with some unanticipated obstacle and what do they do? They
 Chapter 2 / The Dilemma 33

have to keep their new aspirations under wraps. Most aspiring leaders of
change will not be prepared for these new experiences and emotions.
Iva: Also, the nature of resistance to organizational learning is not
yet sufficiently understood by businesspeople. Why is the organization
resisting? If we detect resistance, what can we do about it? Can we
develop a productive relationship with resistance? What insights-or
possibly answers-lie in a greater understanding of the nature of the
resistance?

Unlearning
Iva: Organizational learning is a very complex idea and we don't know
enough about how to implement it yet. For example, new learning often
requires that we "unlearn" old ways of thinking and being. But unlearning
is profoundly difficult, perhaps more difficult than learning itself. How well
do we understand the nature of unlearning and what it takes to unfreeze
our most damaging beliefs and actions?

Delays
Bert: The time frame for organizational learning is another barrier. The
business world has grown accustomed to seeking immediate gratification.
In this way, OL is similar to TQM. Despite the many wonderful attributes of
the TQM approach, it was not widely accepted in the beginning. The criti-
cism aimed a t TQM was that it took too long. Oh, sure, we said, TQM works
in Japan, but the Japanese have the patience of Job and therefore they can
spend ten years doing it. But Americans? No! We want results yesterday.
TQM work takes a long time to produce results, so it didn't seem compelling
for a lot of businesspeople. TQM is still not widely accepted, whereas
reengineering efforts appeared to provide just that sort of gratification, a t
least initially.
Organizational learning work has an inherent incubation period. It is
different in kind from a reengineering project, and the result can be a
quantum increase in the sustainability of the organization.

The Value Proposition

Iva: Your references to TQM and reengineering spur me to ask this
question: Why do some management theories create a bandwagon effect
where we all climb on, while others do not? What makes the difference?
Why, for example, did Hammer's theory of reengineering create such a
movement toward reengineering in corporations, but organizational learn-
ing has not been as widely adopted? In the end, the results of reengineer-
ing are not that fantastic.
Bert: Well, I have a theory. Let me try it out on you. There's no ques-
tion that the idea of organizational learning strikes a responsive chord in
4 Part 1 / T h e Vision

many people. It has great "grab appeal." In fact, the idea is even rather
seductive. In some ways, it's like the utopian ideals that have been
beguiling people for centuries. Who could argue with the idea of a saner,
more effective, perhaps more fulfilling workplace? It's only later-when
you get into the practicality of implementation-that you see the prob-
lems with actually making it work in the real world.
Yet, organizational learning has enough substance behind it that a
series of companies have invested in it over a period of years. Those com-
panies have been able t o make that investment, despite the lack o f quan-
tifiable business results that can be directly attributed to organizational
learning. That's almost the Japanese way of doing things. The way we've
been approaching organizational learning says that its success doesn't
depend upon the next quarter's financial statement. Rather, we're invest-
ing in organizational learning because o f its long-term potential.
But there's a problem because very few companies-particularly in
the US.-are going to invest in something like organizational learning
because o f long-term potential. We're talking about learning, we're talk-
ing about knowledge, even training. All of these are considered to be
costs. Currently, there is no value proposition about knowledge that is
broadlyaccepted in business. And until you have that, it's going to be like
the Deming story.4
The Deming story is a great example of our unwillingness t o learn for
knowledge's sake, o f our inability to see the intrinsic value of an idea. The
TQM movement was first offered in the United States in the 1950s. We
turned it down because it did not pass the "CFO test." By that I mean that
we couldn't immediately relate Deming's TQM t o bottom-line results.
Americans couldn't learn from Deming, but the Japanese could, and
over time they honed TQM to the point where it became a powerful
methodology. The Japanese changed the global definition o f "made in
Japan" from cheap and unreliable to cost-effective with high standards
of excellence and conformity t o requirements. Deming's TQM approach
had a lot to do with that.
Iva: But the parallel between TQM and organizational learning isn't
exact. Deming's work in TQM received very little attention in the US. in
the 1950s. I mean, nobody listened t o Deming. But Senge and others who
are writing about organizational learning have gotten their work publi-
cized-which is a hopeful sign. Yet, it's still moving slowly. This troubles
me because there is an opportunity to really gain competitive advantage
by taking organizational learning seriously.
Organizational learning could help us t o both tap individual creative
potential and find ways out o f the repetitive patterns that limit us. But
we're still not taking the organizational learning tools and methods and
applying them t o make that happen. That's the big question we need to
ask ourselves: Why are we not applying organizational learning and what
can we do about it?
 Chapter 2 / The Dilemma 35

If you look a t the research, you see that companies that made a seri-
ous commitment to TQM are more profitable and have higher share
prices than their competitors. But that same research shows, as you say,
that TQM has not been widely adopted. Fewer than 100 companies in the
Fortune 1000 have well-developed TQM infrastructure. In fact, the
majority of US. managers think that TQM is "deader than a pet r o ~ k . " ~
So what does that say?
Bert: It says several things. One of the things it says is that even if
we can prove that something is good for us, we won't engage with i t if
it's incompatible with our culture. TQM just doesn't fit with the culture
of most American businesses, which want a fast return on investment.
Engaging an organization in TQM and getting results takes time, which
may not be in line with the speed expected for returns on investment.
Therefore, the majority has rejected it. Similarly, top management has
not accepted the value o f organizational learning as eagerly as it has
other management trends.
Iva: I wonder about a culture that rejects things that are good for it.
That seems nonsensical, illogical, and maybe even suicidal.
Bert: No, it is very logical. The business environment is demanding
more rigor and more hard evidence in support o f investments in both
time and money. These factors work against the adoption o f organiza-
tional learning. The inherent value o f learning seems obvious. Yet, with-
out an established, immediate, and obvious financial payback-or a clear
value proposition spelled out in practical business language-organiza-
tional learning can be dismissed or undervalued. Mike Hammer promised
that reengineering would yield real, near-term financial results. Some
companies agreed and so did Wall Street.
Iva: In contrast, organizational learning . . .
Bert:. . . doesn't do that. The closest thing I ever saw t o something
that began to put organizational learning in the same category with
reengineering was an article about Peter Senge in one o f the business
magazines. The title was something like, "You could learn something
from this man."
Iva: In the article I spoke about earlier Gary Hamel says, "I have long
admired Peter Senge's approach t o action research with the MIT
Organizational Learning Center."G The fact that Hamel is a strategist, not
an OL expert, says a lot to me.
Bert: But you see the difference. I think we can find other exam-
ples where a new management idea has caught the interest of the
business world and caught the interest of Wall Street-and yet organi-
zational learning has not. You could compare and contrast them and I
believe you'll find that the fundamental difference is that Michael
Hammer and other experts who are accredited by Wall Street talk in
financial terms.
36 Part 1 / The Vision

h a : Even when Hammer doesn't talk about financials perse, when

he talks about concepts like value creation in management, Wall Street
can relate to what he is saying. Wall Street understands what value cre-
ation is. If you talk in organizational learning terms, if you talk about
such things as "building shared vision," you don't get the same response
from Wall Street.
Bert: And that's the dilemma. The business benefit-expressed in
clear business terms-has been left out o f our discussion of organiza-
tional learning.
A lot has been written about organizational learning from a theoret-
ical point of view, but until it gets expressed in terms that are acceptable
to the financial community-which is t o say, financial terms-it's very
difficult to get a critical mass of enthusiasm behind it.
Iva: Exactly. We believe that there is a significant potential for busi-
ness to benefit from organizational learning. Organizational learning
clearly speaks to deep human needs for transformation o f the workplace.
We can imagine a workplace as a space where greater humanity, hon-
esty, and personal fulfillment can be embraced. But, as you've said, since
we cannot yet guarantee the benefit in financial terms, nobody listens.

Who Will Stand on the Burning Platform?

Bert: I suggest that a related aspect of the problem is that the "change
masters" of organizational learning are naive for the most part. Mostly,
they're academicians who believe that this theory will, on its own, show
value and merit and gain attention and investment,
But businesspeople look a t organizational learning and, although
they may like what they see, they know that an investment in organiza-
tional learning will not pass any rigorous marginal efficiency o f invest-
ment criteria a t present. In other words, it won't pass the CFO test. So
we have a dilemma.
A strategy calling for an investment with no clear return can be pro-
mulgated only by people who are strong advocates, but that's not a win-
ning strategy in the long run. If that remains the main way o f dissemi-
nating organizational learning, then it is ultimately limited-and that is
a terrible loss t o the business community.
We need to create a greater awareness of this conundrum. The orga-
nizational learning community is now comprised of three subcommunities:
academics, consultants, and businesspeople. We need to engage the aca-
demic and consulting communities as well as the business community in
addressing this question. And what is the question, exactly? The question
is, how do you build a bridge from current reality to a new reality?
We can't just declare that all business measures are antiquated. We
can't just ignore business's requirement for a return-on-investment-
because that ignores current reality. And one of the most fundamental
 Chapter 2 / The Dilemma 37

aspects of creating shared vision in organizational learning is an

acknowledgement of current reality, no matter how unpleasant we might
think it is.

The Problem o f Measurement

Iva: It is unclear how this vision can be realistically attained since the
business world requires pragmatic, financial considerations to take prece-
dent. How is it possible to bring these two goals into alignment?
Bert: The assessment and measurement of the effectiveness of orga-
nizational learning is a problem. While the business world craves pre-
dictability, a learning orientation is, by definition, concerned with creat-
ing something new. Therefore, success occurs in unexpected ways. The
results of organizational learning efforts, while they can be significant,
are often qualitative-they don't necessarily lend themselves t o tradi-
tional numerical measures. Because of these differing sets of expecta-
tions, early organizational learning experiments seem t o have had mixed
outcomes.
So, while there has been some clear progress, the results have also
been viewed as contradictory and controversial. The diffusion or transfer
o f learning and the sustainability of learning efforts also remains elusive
and problema tica I.
Iva: We have focused on the need for empirical proof that organi-
zational learning works, but perhaps all that is necessary is a good logi-
cal argument that links organizational learning with high performance.
If you look at the history of TQM, it was the logic embedded in what
Deming said, not necessarily the results that TQM produced, that
engaged the early adopters of TQM.
In simplistic terms, we can say that businesspeople respond to things
either because of need or because o f greed. I don't mean "greed" in the
Biblical sense, but rather the desire t o make more dollars. By "need," on
the other hand, I mean the sense that if I don't do this, then I'm going t o
lose the customer.
Bert: In other words, the motivation is either crisis or growth. We
may wish there were other motivators, but that's the reality.
Iva: Now, if we look a t TQM, Just-in-Time (JIT), et cetera, all these
ideas were obviously supporting greed, i.e., making more money. The idea
is that if you're faster than others, you're going t o make more money. You
know that if your quality is not as good as somebody else's the customer
will leave you sooner or later.
If all the above is so, then does organizational learning help to sat-
isfy need or greed? We don't really have an answer for that. So the essen-
tial question is, does organizational learning facilitate high performance,
or is organizational learning t o be pursued as an end in and of itself? If
38 Part 1 / The Vision

it's the latter, then do we take it on faith that performance will also be
improved? Because, in the end, i f it doesn't create wealth, it has no value
to businesspeople.
Bert: Right. It has added value to the businessperson if it drives
growth.
h a : I would say it adds value if it creates wealth. I like that concept
better than growth, Bert. Growth means nothing. You can grow and lose
your shirt on the way. Creating wealth is a better concept. And by
"wealth," we're not talking about just creating personal wealth.
Bert: No, we're talking about improving the value o f the enterprise.
Iva: For all the stakeholders: the employees, the shareholders, and
the customers. Everybody.
Organizational learning is like a new technology or a new product
introduction. The risk is always much higher when you don't know exactly
what the outcome is going to be. I submit that you have t o take a lot on
faith in the beginning. There's nothing wrong with that, necessarily. We
take risks with technology every day. Look at all of the ventures that have
sprung up because of the Internet, for example. In a sense, organizational
learning could be viewed as just another new technology.
Bert: Let me make the pragmatist's argument: A degree of calculated
risk is taken every day in normal business life. Both a new product launch
and the introduction o f a new technology require a certain degree of cal-
culated risk. But organizational learning does not fit this formula. The
unfortunate thing is that it is complex and not very predictable and-
Iva: There is no clear feedback loop.
Bert: With new technology, you generally have a way t o get feed-
back. Your feedback tells you whether the new technology fundamentally
works or doesn't. You know if it works partially, or if it works with cer-
tain criteria in certain areas. For example, in medicine you know whether
a drug cures or doesn't cure, or if it cures with tremendous side effects.
You look a t the measures-
Iva: Bert, you're right in one sense, but there is a more fundamental
issue and that is that organizational learning may not lend itself a t all to
troditional measures. Furthermore, the problem may not be with organi-
zational learning perse. Rather, the problem may be that we are not
measuring the right things in the right way.
We may need t o change some of the ways in which we assign and
assess value in business. Just think about the kinds o f metrics we accept
almost without thinking. For example, we talk about people as assets, yet
we treat them as costs and liabilities on our balance sheets. What a con-
t rad ict ion.
Until we change how we measure, how we structure the balance
sheet and the income statement, it may not be possible to use our tradi-
tional measures t o assess to what degree an organization is learning.
 Chapter 2 / The Dilemma 39

Dancing with Paradox

Bert: Then it seems that organizational learning work is about two
things that are in some ways contradictory to one another. In one sense we
are trying use organizational learning to accomplish business results that
are meaningful in the way we measure things now.
Iva: And the other is that organizational learning necessitates that
we change what we measure and how we measure it.
Bert: It's about immediate gratification. It's that "ya gotta have
ret u r n- o n - invest m e nt ," "W a I I Stree t 's got t a be satisfied ," " I got t a have
seven percent growth per year, every year, or I'm not viable."
Iva: And it's not at all clear t o me that growth is always good.
Bert: Agreed. Agreed. But I would say that in America in general, big-
ger is better and more is better. And faster is better.
Iva: Yes, that's the motto under which our whole society is built.
Everything we do, think, feel-
Bert: So that presents a challenge t o us and to organizational learn-
ing. Either we're going to demonstrate that it's in sync with our present
business goals, that it will enable us to get bigger and better with more
on the bottom line, or-
h a : Let me give you the reverse of that. What if it would be possi-
ble to create results that are even more in line with our deeper aspira-
tions, rather than following the model o f "better, faster, and larger?"
What if organizational learning tools and methods can actually enable us
to create those results?
If you look a t what is happening in businesses today, you see that a
lot of people are suffering from overwork, overstress, and overworry
because they're trying to create bigger, better, etc. They're retiring early
if they can or they're trying t o create something different. Some are
starting t o get engaged with organizational learning work because
they're realizing that the old way of working isn't worth it any more.
What if the deeper question is: Is there something about organiza-
tional learning that suggests that we have to "throw away" something
that has been very useful t o us? Is that the primary reason why we can't
embrace it?
Bert: You're suggesting that organizational learning is going to
change everything. M y pragmatic nature says that's too radical, too rev-
olutionary. I say that you have to work with the business culture that
currently exists, whereas you're saying that we work on changing very
basic assumptions-and maybe the culture o f business itself.
I'm a bit scared of the latter because it's counter t o a basic premise
that I have, which is that you've got to work with a culture in order to
change it. If you start by attacking the very tenets o f the culture, then
the culture tends t o reject you.
h a : Perhaps this is not a question that we can answer right now.
Perhaps it is not a case of either-or. There is something else that I have
40 Part 1 / T h e Vision

learned from doing organizational learning work that may apply here.
When you face a question like this, where the only apparent answers are
unsatisfactory, there is probably another alternative. I have learned that
it may show up if we just stay with the question.

The Crossroads
Sawy businesspeople have grown tired and suspicious of
management fads. Is organizational learning just another fad? We
do not believe so. However, the current situation presents a chal-
lenge to organizational learning because there is real danger that
it may be dismissed as a fad unless some of the serious barriers to
further proliferation are addressed. There is much work to be done
before organizational learning concepts and practices can be
widely embraced. Before that happens we must learn to live in a
state of tension even as we work to continuously transform it.

living in Creative Tension

In The Fifth Discipline, Senge uses the analogy of the stretched rub-
ber band to explain the tension that exists between vision and cur-
rent reality. When human beings experience this kind of tension
we want to resolve it. There seem to be two ways: either we reduce
the vision (allow the rubber band to spring back), or we work to
change current reality in order to bring it closer to the vision. The
latter is harder to do, of course, because we must hold the tension
longer, but it illustrates how tension can be resolved by taking a
creative approach rather than merely a reactive approach.
Ironically, the dilemma of organizational learning mirrors this
tension. We are drawn to the promise that organizational learning
holds, but we cannot yet prove its worth within the context of our
traditional financially based measures. Thus, we are pulled back
into the safety of our old system of thinking and behaving.
Conversely, we sense that our old system, though safe, is inade-
quate to the needs, possibilities, and aspirations of the present
and future. We want to stretch our old system such that it can val-
idate new forms of measurement, but we find ourselves oscillating
unsatisfactorily, caught between inspiring vision and practical
reality, inconsistent in our thoughts and actions.
Robert Fritz writes that when you hold resolution in abeyance
you can tap into the energy that is available during the three stages
of the creative cycle: germination, assimilation, and completion.
In the germination stage, you make choices about the results you
want to create. In the assimilation stage, you allow for long peri-
 Chapter 2 / The Dilemma 41

ods during which it appears that nothing of significance is hap-

pening, knowing that momentum is building. Finally, you develop
the capacity to successfully create your vision.'
People who have learned to be more creative rather than reac-
tive are better able than most to tolerate the discrepancy between
what they want and what they have. They know how to turn the
tension of the discrepancy into a creative force. It becomes the
engine of the creative process. They are able to tolerate a realistic
assessment of the state of current reality and the distance between
that and their vision without immediately attempting to resolve
the tension.
This tension between vision and current reality is not resolv-
able within itself. It can only be resolved if we are able to hold the
tension as we seek to replace the source of the tension with some-
thing else. The "something else" usually arises out of a shift in our
belief system. The challenge is to hold that tension and see it as a
source of creativity, rather than react to it immediately and try to
force it away.
Will businesspeople be willing to meet this challenge? Will
they respond to the challenge of remaking their world, taking on
the many questions and dilemmas we have raised-particularly
the question of measurements? Will they have the courage to
embrace learning as a way of life despite the current barriers and
risks? Will they be able to hold the tension?
In Part 2 we tell the stories of two people, Bert and Iva, who
had the courage to step off the edge of their world and try.

Endnotes

1. Arie de Geus, "Planning as Learning," Harvard Business Review,

March/April 1388, pp. 70-74.
2. Arie de Geus, No Globalization without Learning, speech given at
Systems Thinking in Action Conference, 1333, audio tape
available from Pegasus Communications, Waltham, MA.
3. Gary Hamel, "Strategy Innovation and the Quest for Value,"
Sloan Management Review, Winter 1338, pp. 7-14.
4. See Mary Walton, The Deming Management Method (New York:
Dodd, Mead, & Company, 1386).
5. J. A. Byrne, "Management Theory-Or Fad of the Month,"
Businessweek, June 23, 1337, p. 47.
6. Hamel, 1338, op. cit., p. 13.
7. Robert Fritz, Path of Least Resistance (New York: Fawcett
Columbia, 1334).
 Part 2
The Journey
Warts and All

Ioflearning
n the first section we presented our arguments for organizational
(OL) and the promise it holds. We also discussed some
the challenges and dilemmas yet to be resolved. In the following
section we explore some of the practical realities involved in imple-
menting organizational learning in today's business world. We do
so by sharing the very personal stories of our attempts to lead learn-
ing efforts-warts and all-and by interpreting those stories within
a framework of theory. By so doing we hope to turn individual expe-
riences into opportunities for learning.
Chris Argyris has written, "Anyone who has planned major
change knows:
How difficult it is to foresee accurately all the major prob-
lems involved;
The enormous amount of time needed to iron out the kinks
and get people to accept the change;
.The apparent lack of internal commitment on the part of
many to help make the plan work, manifested partly by peo-
ple at all levels resisting taking the initiative to make modi-
fications that they see are necessary so the plan can work."'

43
44 Part 2 / The Journey

These obstacles very much exist in the practical world of busi-

ness organizations. As businesspeople committed to OL, our chal-
lenge is to develop the practical wisdom that will enable us to
anticipate and work through these obstacles as they arise. Early
adopters of OL must learn how to lead learning efforts effectively.
While there is theory to draw upon, theoretical and conceptual
thinking can only take us so far. We do not believe that it is an easy
task to translate theory into practice within the dynamic context
of real, live organizations. The real learning is in the doing. Out of
that come practical knowledge, practical philosophy, and even
practical wisdom. This is the key to lasting change. We think that
the development of this practical wisdom requires the following
on the part of businesspeople:
Faith-Pragmatists and visionaries alike must start with
belief in the premises of OL. This requires a moderate
amount of faith.
Clear understanding of the theory-Despite our practical
orientations, businesspeople who engage with OL are, in a
sense, engaging in research and experimentation. Despite
Kurt Lewins famous admonition that there is nothing so
practical as a good theory,2we know that practical business-
people tend to resist theory. Still, we must have a working
understanding of the theory we are attempting to implement.
Active interpretation of the theory-As businesspeople our
task is to bring the theory to life; we have to try the theory
out.3
Sharing of our stories and reflection upon our experi-
ence-We cannot create practical knowledge without shar-
ing our stories, which requires showing our vulnerability.
But if more of us share our stories, that practical knowledge
can be further refined and developed. Through sharing and
then analyzing these stories with an eye toward learning
from them, we can create a feedback loop. If we do this in
community we can begin to close the gap between theory
and practice. Together we reflect upon results and we inquire
into each others assumptions-each others working theo-
ries. We invite feedback from outside our own experience. If
we do so collectively, we can develop our practical wisdom.
These steps can be illustrated as a cycle, with faith as the entry
point. As we move around this circle we participate in the stages
that theorists such as David Kolb have described as the experien-
tial learning cycle.4 This cycle gives us a full view of the process of
learning; it links ideas to experience, and action to reflection. In
this cycle, abstract conceptualization (theory) leads to active
 Part 2 / The Journey 45

experimentation, which leads to specific, concrete experience.

Ideally, we reflect upon that experience, reframe if need be, and
then go around the cycle again testing our new ideas.

Experience

f \
Experimentation Reflection

t
Conceptualization
The Learning Cycle

An understanding of this process of learning is essential to

bringing about OL in our corporations. It is also essential that we
use that understanding of the process of learning to design our
learning efforts and to make sure that we are able to learn from
our experiences and share those learnings with others.
Bert and Iva's willingness to share their stories speaks to their
commitment to this learning process. The stories illustrate how
businesspeople can participate in the learning cycle. As they share
their stories, we hope that the stories will stimulate your thinking
and your sense of inquiry. Some aspects of our stories may res-
onate with your own experience, or suggest things to consider as
you walk your own path. As you read, we hope that you will find
yourself participating in what we believe are intimate experiences
of the nature of learning itself. On our separate journeys, and in
the time since, we have come to understand how the experience of
true learning shifts expectations-particularly those expectations
that have been shaped by the current business environment. We
have learned that when one allows oneself to live in learning,
one's basic assumptions are up for grabs.
And, as you learn about our experiences and our reflections
upon those experiences in our own words, you are invited to con-
sider what we might learn from these stories. We invite you to
think about how you might design your own strategy, drawing on
these learnings.

Endnotes

1. Chris Argyris, On Organizational Learning (Malden, MA:

Blackwell Publishing, 1939), p. 123.
46 Part 2 / The Journey

2. For more on Kurt Lewins work please see Edgar H. Schein,

Kurt Lewins Change Theory in the Field and in the
Classroom: Notes Toward a Model of Managed Learning,
Reflections: The SOL Journal on Knowledge, Learning and Change,
1333, V O ~1,. NO. 1, pp. 53-74.
3. We are greatly indebted to Professor C. K. Pralahad for help-
ing us to make these connections.
4. David A. Kolb, Experiential Learning (Englewood Cliffs, NJ:
Prentice-Hall, 1384).
Chapter 3
The Compass
As we reflected on the two stories and what we were learning as we
continued to review and consider, we realized that we needed a
frame of reference-a framework- to help us interpret what hap-
pened. We needed a framework that could provide a container for
all that we were thinking and learning. While both Berts and Ivas
change strategies had revolved around Senges The Fifth Discipline,
we found that we needed a broader framework. We needed to
sweep in Senge et alls later work in The Dance of Change ( 1333) as
well as the work of Chris Argyris, organizational culture theorist
Edgar H. Schein, and others who have laid down some of the
foundational ideas that make up the field of organizational learn-
ing. If we looked at the stories in this context we hoped to be able
to find greater meaning.
In the Introduction to this book we offered a definition of
organizational learning as the process of forming and applying
collective knowledge to problems and needs. It is learning that
helps the organization continually improve, achieve goals, and
attain new possibilities and capacities. It is learning that taps into
employee aspirations, fueling commitment and creating the energy
to change. Now we offer another, more operational definition to
help us in our analytical process.
Nancy Dixon has defined organizational learning as the
intentional use of learning processes at the individual, group, and
system level to continuously transform the organization in a direc-
tion that is increasingly satisfying to its stakeholders. Dixon
reminds us that all organizations learn. To some extent, all orga-
nizations adapt to environmental constraints, prevent the repeti-
tion of past mistakes, and generate innovative new ideas.They do
this by learning at all three levels: individual, group, and organi-

47
48 Part 2 / The Journey

zation. Although such examples of learning occur, equally typical

are situations in which learning is not achieved, that is, "organi-
zations repeat their mistakes, fail to adapt to customer needs, and
are unable to improve their processes to meet rising competitive
standards. " 2
The conclusion we reach is that even when learning does
occur, it is often accidental rather than the result of intention. Not
only can some organizational learning be accidental, it can also be
flimsy, weak, and depthless; organizations can learn the wrong
lessons. Most organizations are, at best, inefficient learners and
therefore much that could be learned is lost or missed. Why the
inefficiency?
A primary difference between the accidental learning that hap-
pens in many organizations and organizational learning, Dixon
says, is intention. Most organizations are inefficient learners
because they operate with a learning deficit-they lack intentional
processes that would help facilitate learning at all three relevant
levels. Dixon also emphasizes process. If we in organizations want
the outcomes that OL promises, we must engage in deliberate
processes, rather than rely upon accidental learning.

Action Science as a Framework for Interpretation

How do we know that an organization has learned? According to
Chris Argyris, an organization has learned when:
The organization achieves what was intended. This happens
because there is a match between its design for action and
the actual outcome achieved.
A mismatch between the intended outcome and the actual
outcome is identified and corrected, so that the mismatch is
turned into a match (Argyris, 1393, p. 67).
It should be a foregone conclusion that both of these forms of
learning are needed in the business world. Yet, there is great vari-
ance in the ability to execute them. The field of organizational
learning is concerned with enabling these forms of learning.

Single-loop and Double-loop learning

Argyris writes that most organizations are reasonably skilled in
what he calls single-loop learning. A single loop of learning occurs
when an action designed to achieve a result works, or when an
error is detected and is successfully corrected. In single-loop learn-
ing there is no questioning or altering any of the assumptions that
underlie the design of the action. Argyris goes on to say that most
 Chapter 3 / The Compass 49

organizational learning activities are single loop. Single-loop

learning is quite appropriate for the routine, repetitive, everyday
issue.
While single-loop learning can certainly be productive, it has
its limitations. Single-loop learning may produce results in certain
situations, but the problem is that it is not a sufficiently powerful
form of learning and it is not appropriate for learning in more
complex, nonprogrammable situations. It is inadequate for deal-
ing with the increasing complexity that organizations are facing
today. Argyris believes that organizations need to develop the
capacity for double-loop learning because this is a more powerful
form of learning and it is needed in order to bring about transfor-
mational change and to develop more profound capacity within
organizations. The double-loop actions are the master programs
that control the long-range effectiveness and, hence, the ultimate
destiny of the system.
Double-loop learning occurs when mismatches between
actions and results are corrected in a two-step process. The first
step involves examining and perhaps altering those assumptions
that guided the actions, and then, secondly, examining and alter-
ing the actions themselves. Argyris holds that more often than not
it is the assumptions underlying our actions that are the more sig-
nificant barriers to learning and profound change. Therefore
assumptions represent important levers. However, they are often
implicit and tend to go unquestioned.
Organizational learning tools and techniques can help to shift
an organization from accidental to single-loop and then to dou-
ble-loop learning. In sum, then, we can speak of three levels of
possible learning in organizations:
Accidental organizational learning-Learning that occurs
without intention or process. This form of learning can be
insubstantial or limited; organizations can even learn the
wrong things.
Single-loop learning-Organizations engage in an inten-
tional learning wherein actions are deliberately designed
and errors detected while the sources of errors, the embed-
ded assumptions, go unquestioned or ignored. This type of
learning yields results for certain types of problems and it
may be easier for organizations to adopt, but it is limited.
Double-loop learning-This involves a commitment to a
deeper, riskier, and potentially far more rewarding process-
a process that we will call "deep organizational learning."
As a starting place, we might think of an organization's learn-
ing ability as being located somewhere on a continuum that
50 Part 2 / The Journey

reaches from limited to single-loop to the capacity for double-

loop learning.
Figure 3.1
Learning Continuum 1
4 *
Limited Learning Intentional OL Deep OL
(accidental learning] (single-loop IearningJ (double-loop IearningJ

Organizations have the capacity to move from accidental, lim-

ited learning to more intentional, single-loop learning, to deeper,
double-loop learning. If this is true, then those who would lead
learning efforts must have a sense of where on the continuum the
organization is currently and where it wants to go, and then devise
a strategy for how it will begin that journey, whether the destina-
tion be only intentional OL or beyond. When embarking on an
organizational learning effort, we believe it is helpful to under-
stand this landscape so that we can design our strategies accord-
ingly.

Why the Need for Deep Organizational Learning?

Argyriss research has shown that organizational change tends to
focus on developing an organizations capacity for single-loop
learning. Furthermore, he believes that even the field of organiza-
tional learning has been concerned with enabling single-loop
learning. Writers on the learning organization, he writes, tend
to focus on first-order errors, those due to mistaken or incom-
plete action strategies and assumptions of the sort that practi-
tioners ordinarily detect and try to correct.3What we dont tend
to pay sufficient attention to are the deeper sources of errors: those
factors that cause errors to be made in the first place and which,
in turn, inhibit organizational performance.
Argyris says that we dont pay attention to those deeper
sources of errors because people in organizations are often sys-
tematically unaware of them. Organizations tend to be permeated
with defensive routines-mixed messages, taboos on discussing
the key issues, games of control and deception, and other forms of
organizational camouflage. All of these phenomena tend to create
error and, ironically, also inhibit our ability to detect and correct
error. These sources of errors are often systemic in nature and so
we dont tend to see them, just as we imagine that fish dont real-
ize theyre in water-unless, of course, theyre removed from it.
It is worthwhile to define what Argyris means by organiza-
tional defensive routines. Defensive routines are the policies or
 Chapter 3 / The Compass 51

actions we put in place to prevent ourselves and our organizations

from experiencing embarrassment or threat. The unintended con-
sequence of these defensive routines is that they also prevent any-
one from identifying and thereby reducing the causes of the
embarrassment or threat.4 This is why we all tend to collude in
admiring the emperors new clothes-and why we feel such a
sense of chagrin when we realize that the emperor is, indeed,
unclad.
Organizational defensive routines are anti-learning and over-
protective, says Argyris. The Challenger disaster is a classic exam-
ple of how organizational defense routines can affect outcomes.
Even though the major players certainly had the ability to recog-
nize and report the O-ring problem, the can do attitude of the
major players had them so focused on operational objectives that
their ability to recognize and report problems was restricted.5 In
this example we can see what happens in many organizations: a
can do, winning attitude can blind people to seeing, and inhib-
it them from reporting and dealing with a potentially serious
problem.
What causes these defensive routines and how do we over-
come them? Argyris contends that they are a product of the limited
learning system that we create in our organizations.

The Causes of Errors: Limited Learning Systems

In earlier work Chris Argyris and Donald Schon proposed that
most behavior in organizations today is shaped by a common set
of governing variables. These governing variables are:
Strive to be in unilateral control;
Minimize losing and maximize winning;
Minimize the expression of negative feelings; and
Be rational.
These values lead to behaviors and actions that are primarily
aimed at avoiding embarrassment or threats, such as:
Advocate your views without encouraging inquiry (hence,
remain in unilateral control and hopefully win);
Unilaterally save face-your own and other peoples (hence,
minimize upsetting others or making them defensive);
Design and manage situations unilaterally (in order to
maintain control);
Evaluate the thoughts and actions of others in ways that do
not encourage testing the validity of the evaluation (and our
own thoughts and actions);
52 Part 2 / The Journey

Attribute causes for whatever we are trying to understand-

without necessarily validating them;
Engage in defensive actions such as blaming, stereotyping,
and intellectualizing to suppress fee1ings.G
Interestingly these variables don't necessarily match the values
that people espouse (most of us apparently aspire to operate
according to a "higher" standard), yet these variables tend to
shape our behaviors, particularly under stress. Since business envi-
ronments are often stressful, these values come into play most fre-
quently, despite whatever values people espouse. Argyris and
Schon call this constellation of variables and the actions that
derive from them "Model I theory-in-use. (The term "theory-in-
"

use" says that this theory can be inferred from our actions even
though we may espouse a different set of governing variables.)
Model I tells individuals to craft their positions, evaluations, and
attributions in ways that inhibit inquiries into and tests of them
with the use of independent logic. Furthermore, research has
shown that Model I theory-in-use seems almost universal; it
appears to cut across culture, age, gender, and economic status.'
The consequences of these Model I strategies are likely to be
defensiveness, misunderstandings, and self-fulfilling and self-seal-
ing processes. Like single-loop learning, Model I behaviors are
useful in some situations-but are not useful in more complex sit-
uations where we must seek the best, most valid information.
Errors cannot be readily detected in situations where everyone is
colluding in saving face.
The crucial link here is that Schon and Argyris hold that
human beings programmed with Model I-and that includes
almost all of us-will create and impose a limited learning system
on any organization in which they participate. In other words, we
tend to create organizational cultures that reinforce these values
and behaviors regardless of who comes or leaves. They term this
an "organizational Model I learning system.''
The paradox comes about because these Model I-based orga-
nizational learning systems reward limited learning and give rise
to organizational defense routines. In fact, they are a type of
defense routine. They also give rise to other negative consequences
such as taboos and control games and mixed messages. So, with-
out intending to, we start to create "Dilbertian" environments.
And, as a consequence, our business results are not what they
could be. Why? Simply put, because we are disabling intelligence
that could be brought to bear on solving complex problems and
making more efficacious decisions.
To compound the problem double-loop learning will not
occur naturally in organizations whose structure is congruent
 Chapter 3 / The Compass 53

with Model I. Model I learning systems discourage double-loop

learning, because double-loop learning will result in question-
ing the assumptions that are the bedrock of the Model I learning
system.
Why, despite the adverse consequences, do we all seem to act
in accordance with Model I? First, because Model I is based upon
values that were instilled in us in childhood and reinforced
through most of our educational and work life experiences. This
makes it very difficult to change because changing requires that we
explore very strongly embedded values and assumptions within
our own psyche. Few of us have the skills or courage to be able to
do this alone.
Secondly, we have constructed a system that is self-reinforcing
and self-perpetuating, making it extremely difficult for us to
change the system unless we fully understand and confront it. To
get to double-loop learning and deep OL, we must break the
stranglehold that Model I has on us both as individuals and as
organizational cultures. This is a deep sea, and we have only
recently begun to wade, rather tentatively, into it.

The Way to Deep Organizational Learning

The stranglehold can be broken if we are able to engage a new set
of governing variables and behaviors which Argyris and Schon call
Model 11. Model I1 behaviors are governed by an entirely differ-
ent set of variables than Model I, and they create an entirely dif-
ferent, more open working environment. In Model 11:
We value valid information over being perceived as know-
ing or being right. When we operate in accordance with this
theory-in-use, all of our processes are open to being ques-
tioned. We are much less defensive.
We value free and informed choice. We want others to
agree and make decisions because they are informed and
believe that the choice is right, rather than making choices
based in control or coercion. This leads to tasks being con-
trolled jointly, and interpersonal and group dynamics
being minimally defensive. As a consequence, we can
engage in double-loop learning, effective problem-solving,
and decision-making.
We value internal commitment to the choice (versus com-
pliance) and vigilant monitoring of the implementation of
the choice in order to detect and correct error. We now speak
in directly observable categories, and seek to reduce blind-
ness about our inconsistencies and incongruities. We oper-
ate according to learning-oriented norms such as trust and
54 Part 2 / The Journey

openness, and we test our theories publicly. Protection of

self is a joint enterprise oriented toward everyones growth.
People who recognize the value (and efficacy) of these vari-
ables can learn the skills necessary to design new action strategies.
These action strategies include:
Openly illustrating how they reached an evaluation or attri-
bution; and
Openly sharing how they crafted these evaluations or attri-
butions to encourage inquiry and testing by others.
In essence, when people operate according to Model 11, they
begin to make the underpinnings of their thinking explicit, both
to themselves and others. If the assumptions can be made explicit,
then they are open to being questioned, tested, and changed.
Peoples reasoning is productive rather than defensive. Operating
this way gives rise to much more desirable consequences. The
organization becomes a place where:
Search is enhanced and deepened;
Ideas are tested publicly;
Individuals collaborate to enlarge inquiry; and
Trust and risk taking are enhanced.8
These are the key elemental descriptions of an organization
that is capable of learning what it needs to learn. The move toward
openness breaks the cycle of the over-protective, self-sealing
behaviors that systemically prevent the detection and correction of
error. This leads to learning and learning leads to more effective
performance.
It is important to note that Model I1 is not merely the opposite
of Model I, but rather a vital new set of governing variables and
resulting action strategies. The two are compared and contrasted
in Table 3 . 1 .

The Bud News and the Good News

Let us recap the ideas weve laid out so far:
The evidence we use to determine whether or not an organi-
zation has learned is when an organization is able to pro-
duce the results that it set out to produce.
This implies two forms of learning: the organization is able
to design its actions effectively such that it gets the outcome
it desires, and it is able to correct the design when the inten-
tions and the outcomes are found to be out of line.
 Chapter 3 / The Compass 55

Table 3.1
Comparison of Model I and Model II Theories-in-Use

Model I Model II

. .
Governing Variables: Governing Variables:
Always be in unilateral control [so you Valid Information

.
can achieve your intended purpose).
Free and informed choice
Maximize winning and minimize los- Internal commitment to the choice

.
ing.
and vigilant monitoring of the imple-
Behave according to what you con- mentation of the choice in order to
sider rational. detect and correct error.
Implications: We: Implications:We:
Design and manage situations uni- Share power and co-create situa-
laterally-In order to win we have to tions-Rather than taking control away
control situations-but one gains con- from you in order to accomplish my
trol by taking control away from others. goal, we realize that we share in the
Advocate our views without encourag- responsibility for outcomes. Therefore
ing inquiry (to remain in unilateral con- we share power with anyone who has
trol and hopefully win); competence and who is relevant in
dttciding or implementing the action.
Evaluate the thoughts and actions of We seek to build viable decision-making
others in ways that do not encourage networks in which we maximize the
testing the validity of the evaluation; contributions of each member, enabling
Attribute causes for whatever we are the widest possible exploration of views.
trying to understand-without neces- Inquire-We actively strive to test our
sarily validating those attributions; theories publicly, making our inferences
Unilaterally save face by withholding apparent; we actively seek to reduce
information or making certain things blindness about our own inconsistency
"undiscussable" in order to minimize and incongruity. We try to find the most
upsetting others or making them competent people for the decision to be
defensive. made. We make fewer evaluations and
attributions; when we do, we encour-
Engage in defensive actions such as age others to inquire into them and test
blaming, stereotyping, intellectualizing. them.
We use defensive reasoning: we keep
our premises and inferences tacit, lest We don't strive to save face or pro-
we lose control. To be rational means tect ourselves or others by withholding
"to keep actions in constant alignment information.
with our beliefs," but we believe it Experience less defensiveness-
means "be logical by suppressing emo- People experience us not as defensive,
tions." We fear effectiveness decreases but rather as facilitator, collaborator,
as we become more emotional. choice creator. We seek to support each
other's growth and evaluate every signif-
icant action in terms of the degree to
which it helps the individuals involved
generate valid and useful information
(including relevant feelings).
Adapted from Chris Argyris, On Organizational Learning, I999
56 Part 2 / The Journey

All organizations learn to a greater or lesser extent. However,

much of that learning is accidental.
The field of organizational learning is concerned with devel-
oping the capacity to learn intentionally.
Learning intentionally can result in single-loop learning. OL
tools and methods can be used to build capacity for single-
loop learning.
Profound organizational change requires double-loop learn-
ing, but double-loop learning is deceptively difficult. It will
not occur naturally in most organizations.
This is because, at a very fundamental level, organizations
have unwittingly constructed a learning system that both
enables and disables learning. In the majority of cases, this
learning system is based upon Model I theory-in-use, which
emphasizes control, saving face, and advocating your point
of view in order to win, rather than inquiring into the points
of view of others. Model I-based organizational learning
systems are currently pervasive in our organizations; they
also profoundly constrain deeper forms of learning.

Breaking Free o f Model I

Argyris offers hope that we can break free of Model I and that, if
we do, we can create the organizations we want. As people learn
Model 11, Argyris believes that they will necessarily create an orga-
nizational learning system that then feeds back to reinforce their
new Model I1 theory-in-use. In other words, the process of individ-
ual and organizational transformation occurs simultaneously and is self-
reinforcing.
The link between individual and organizational learning and
transformation is made explicit here. As the theories-in-use held
by individuals come open to question, so do the assumptions
embedded in the organizational culture, and vice versa. The trans-
formation of the organizational learning system cannot occur
without the transformation of individuals from Model I to Model
11; likewise, individual transformation will be impeded unless the
organizations learning system also transforms. The change
processes are interdependent and coexistent and require deliber-
ate processes with groups learning together.
When it comes to designing an organizational learning effort
the essential question is, do we want profound change and opti-
mum learning capacity, or are we willing to settle for moderate
improvements? If we want profound change and optimum learn-
ing capacity, then it follows that the process of getting from here
 Chapter 3 / T h e Compass 57

to there involves not just OL in the service of single-loop learning,

but a deeper form of OL in the service of double-loop learning.

Tools for Developing a Model I1 Organizational Learning System

Argyris advises that creation of new learning systems requires a
dialectical process in which participants can compare their theo-
ries-in-use and their embedded learning system with the alterna-
tive models. There are several organizational learning tools that
can help us to practice Model I1 behaviors and to create a learning
system more congruent with Model 11. They are:
Ladder of inference;
Balancing advocacy and inquiry;
Left-hand/right-hand column; and
Dialogue.
These tools (described in Table 3.2) can facilitate generative
conversations that help us to build improved organizational
learning systems.

The Deep Organizational Learning Vision: Implications for Leaders

In theory at least, organizations have the potential of moving from
accidental, limited learning to more intentional, single-loop
learning, to deep OL with double-loop learning.

Figure 3.2
Learning Continuum 2

Limited Learning Intentional OL Deep OL

(accidental learning) (single-loop learning) (double-loop learning)

Model I Learning System Model I1 Learning System

If the people in an organization truly wish to break the hold

of Model I, to free themselves from defensive routines, and to
engage in double-loop learning, they must begin to construct a
Model 11-based learning system. This means that key individuals
must learn the new values and skills necessary to create Model I1
and then endeavor to create learning communities, communities
of practice. We try to bring the Model I1 learning system to bear in
our organizations by entering into learning communities charac-
terized by learning-oriented norms (trust, individuality, open con-
58 Part 2 / The Journey

Table 3.2
Tools for Developing a Model 0-11Learning System

Tool or Method Description

Ladder of Inference A conceptual tool designed to show h o w w e tend

to act o n beliefs that are quite removed from
observable data and actual experience, thus creat-
ing self-reinforcing belief and action systems. The
lowest step of the ladder represents observable
data and actual experience. The second rung of the
ladder represents the data to which one chooses to
pay attention, which is actually one step away from
actual data and experience. The next rung repre-
sents the meanings one assigns to that selected
data. At the fourth rung are the assumptions one
makes based on those assigned meanings. Then
rung five represents the conclusions one draws
based o n those assumptions. At rung six w e have
created a whole set of beliefs based on all that has
gone before. At rung seven, w e take actions based
on our beliefs.
When w e operate according to Model I theory-in-
use w e tend to make attributions and evaluations
of actions or events without sharing or testing our
reasoning. The ladder of inference can help us be
more aware of h o w our beliefs shape what w e are
able to see and h o w our assumptions constrain our
actions, and it can help both individuals and teams
be more effective.9
When w e are operating out of Model I w e tend to
advocate our positions so that w e can "win."This
strategy can fail us, however. When w e are dealing
with complex problems w e need to seek out the
best answers and learn from one another, but
advocacy leads to defensiveness o n the other side
and thus to rigid positions on both sides.
Arguments escalate without being resolved, and
rigid thinking prevents learning.
Balancing Advocacy and Learning to balance advocacy and inquiry often
Inquiry requires adopting new conversational skills. We
must reveal the assumptions and reasoning behind
our o w n views (which makes us vulnerable) and
also inquire into the thinking behind the views of
others. At first, w e may have a tendency to overcor-
rect, to focus on inquiry alone, but our goal is to
find the balance between advocacy and inquiry,
which fosters generative conversations about things
that matter. 10
 Chapter 3 / The Compass 59

Left-hand/Right-hand Left-handhight-handcolumn is a concept that

Column helps people to become aware of the tacit assump-
tions that can get in the way of effective communi-
cation. Often people learn to use this technique by
reflecting on a difficult conversation. In the right-
hand column they write down what they actually
said and in the left-hand column they write down
what they were thinking at the time. By comparing
the two they can see where their assumptions
inhibited their communication almost instinctively.
As people become more aware of those tacit
assumptions, they can begin to test them and
move into more productive conversations. I
Dialogue Dialogue is a collective reflective learning process.
In a sense, dialogue attempts to create a container
or field in which people begin to perceive them-
selves, the world, and each other differently. At its
best, dialogue gives rise to new insights and helps
us to break through the assumptions and illusions
that constrict our thoughts, actions, and
aspirations. 2

firmation on difficult issues). We invite double-loop learning and

take actions to solve problems in such a way that they remain
solved (versus quick fixes), and do so without creating defensive
routines that reduce the present level of problem-solving effec-
tiveness.
Argyris advises that efforts like this must start at the top
because it is too difficult, if not impossible, to create a sustainable
Model I1 learning system at the lower levels. We leave this to you
to consider. We believe that leaders of learning efforts must have a
sense of the dynamics weve outlined as a starting point. In a
sense, they must understand what they are up against if they
undertake such a learning effort; they must understand how resis-
tant the organization will be to undertaking deeper forms of learn-
ing. This is largely because there is a systemic reinforcing process
that keeps the organization-and the leaders as well-anchored
in Model I.
Argyris cautions us that getting to Model I1 is not easy. It
requires patience and an appreciation for time delays and the
inevitable regression because, he has observed, individuals who
value Model I1 and wish to learn it are unable to produce Model
I1 actions during the early phases of learning. Learning Model I1 is
going to be, he writes, at least as difficult as learning to play,
moderately well, a musical instrument or sport.13It takes a good
deal of time and reinforcement before an individual is able to
60 Part 2 /The Journey

behave in accordance with Model 11, and even longer before the
organizational learning system can be transformed.
In the meantime, the old learning system will resist being
changed. As Argyris points out, in order for double-loop organi-
zational learning to occur, individuals must be able to alter their
theories-in-use and to neutralize the old learning system while
simultaneously, and probably under stress, acting according to a
new theory-in-use ( e g , Model 11) and creating a new learning sys-
tem. There are implications for leaders. The individuals who are
leading this transition must straddle two systems, Model I and
Model 11, both at the individual and organizational levels. They
will be required to monitor and guide their own internal transfor-
mation process. Contemporaneously, they will endeavor to nulli-
f y the existing learning system (in which others and the organiza-
tion are probably highly invested) in the interests of creating
another learning system which can easily be perceived to be too
soft, too dangerous, or even unachievable. This is one of the rea-
sons why Argyris believes that a learning intervention should
begin at the highest level of the organization.
All of this is not to discourage us, but to heighten our aware-
ness of the arena in which we are playing. For change leaders,
there is a possibility of attempting too much without sufficient
support or understanding-of letting our visions of what could be
take us too far out on a limb. There is also the possibility of not
attempting enough. It is relatively easy to give up on the potential
of a deeper form of OL and to focus on enhancing single-loop
learning. In fact, this may be a very logical first step, but we may
be reducing the tension in the elastic band prematurely.
If we only attempt what the organization can obviously toler-
ate, then we run the risk of following blindly some unsuccesshl-
and perhaps very familiar-patterns such as the one described in
the Introduction to this book.
Is reaching for Model I1 an impossible dream? Perhaps it is
only a matter of courage, commitment, and community. Our dis-
illusionment with the current state of our organizations may
prove to be a gift if it opens the door to significant reform.
What does your organization want? What does it need? What
is it ready for? What kind of a learning effort are you prepared to
lead? We need to ask these important questions so that we can
make free and informed choices about our own OL journeys. In
the following chapters we tell the stories of Bert and Ivas learning
journeys where these questions resonate. We then use this frame-
work to debrief those stories discussing how these two stories may
represent some typical patterns.
 Chapter 3 / The Compass 61

Endnotes
1. Steve 7. Gill, The ManagerS Pocket Guide to Organizational
Learning (Amherst, MA: HRD Press, 2000), p. x.
2. Nancy Dixon, The Organizational Learning Cycle: How We Can
Learn Collectively (McGraw-Hill, 1334), p. 5.
3. Chris Argyris, On Organizational Learning (Malden, MA:
Blackwell Publishing, 1333), p. 6 .
4. Argyris, 1333, op. cit., p. 58.
5. Chris Argyris, Knowledge for Action: A Guide to Overcoming
Barriers to Organizational Change (San Francisco: Jossey-Bass,
1333), p. 17.
6 . Chris Argyris and Donald Schon, Theory and Practice (San
Francisco: Jossey-Bass, 1374); and Chris Argyris and Donald
Schon, Organizational Learning (Reading, MA: Addison-Wesley,
1378).
7. Argyris, 1333, op. cit., p. 51.
8. Argyris, 1333, op. cit., p. 181.
3. Chris Argyris, Overcoming Organizational Defenses (Needham
Heights, MA: Allyn and Bacon, 1330), pp. 88-83; and Peter
Senge et al., The Fifth Discipline Field Book (New York:
Doubleday, 1334), pp. 242-243.
10. Marcia1 Losada, "The Complex Dynamics of High
Performance Teams, Mathematical and Computer Modeling,
'I

Vol. 30, 1333, pp. 173-132. Also, Peter Senge, The Fifth
Discipline: The Art and Practice of the Learning Organization
(New York: Doubleday, 1330), pp. 138-202; and Senge et al.,
1334, op. cit., pp. 253-253.
11. Argyris and Schon, 1374, op. cit.
12. See William Isaacs, Dialogue and the Art of Thinking Together
(New York: Doubleday, 1333).
13. Argyris, 1333, op. cit., p. 87.
Chapter 4
The Pragmatist's Path:
Bert's Jou rn ey
Bert: I pride myself on being a pragmatist, but there are also things
that I care very deeply about. Customer service is one of them. You see,
I came up from the ranks. I spent most of my career in the line organi-
zation. I actually started as a telephone company technician, climbing
poles and working face-to-face with customers.
The telephone company always had this ethic about doing the right
thing by customers and I felt that we did the right thing in those days.
For example, we were part of the community, we had local offices, we
always took the customer's word when there was a problem with a bill,
and we had the ethic of universal service. But in recent times we have
evolved away from that ethic. Sometimes I thought we'd lost the heart
and soul of what drives the telephone company spirit.
For example, I remember that when we changed telephone poles, we
replaced the clotheslines that housewives attached to the poles. Now,
when you change a pole, you're not supposed t o put the clothesline back
because, technically, the clothesline is an illegal attachment and if the
lineman were to reattach it, he would expose the company t o liabilities
i f anything happened as a result. That's very logical and very cautious-
but it's not good service.
Our customer base is the community and the way I see it we are also
part o f that community. That creates a very special bond. People expect
us to be there, not only in emergencies, but all the time. Although things
are changing, people still trust us, a t least to some extent. Some people
still leave their keys under their mats for "the phone guy."
So I carried that ethic with me. I went back to school a t night and
got my degree in electrical engineering. I subsequently got a master's
degree in business administration in finance and statistics and then I got

63
64 Part 2 / The Journey

up into management. All the way through my career, I never lost the
ideas that I had when I was climbing those poles. I always believed that
customer service was important and that we really needed to uphold
that. I guess customer service was my driving idea-it was connected
very much to my personal values. It was deeply ingrained. But as I was
coming up into management, it started t o get tougher and tougher to
provide customer service in the same way because o f financial con-
strain ts.

Backdrop: The Squeeze

Bert: I began my career in telecommunications in Canada. Eventually I
took a position with a phone company in the United States. When I came
into that American telephone company in 1979, the company was not in
great shape financially for a variety of reasons. The company had had to
undergo a lot of changes that were coming a t them pretty fast and furi-
ously. These changes had a big impact on customer service.
The first years that I was there were characterized by a tug o f war
between AT&T, who owned us, and the state regulatory commission, the
Public Utility Commission (PUC), which oversaw all o f our dealings with
the public. The California PUC prided itself on having the lowest rates in
the nation so they began reducing our rate hikes or cutting them totally.
All of our funds came from AT&T, and AT&T started restricting our funds
because the return on investment (ROI) was so low in California. The
squeeze was on.
That was in direct conflict with our long-standing philosophy, which
was, "customer service is number one." Our whole mentality was focused
on service. This was an expensive philosophy, but we could afford it
because we knew that the cost of service was reimbursable through a
rate increase. Now that mentality had to change. We simply couldn't
afford it because we couldn't raise our rates. We had to go into a belt-
tightening mode.
Then came those famous rulings. In 1984, ATBT was split up through
the consent decree of the Department of Justice. Things really had t o
change.

Outside Pressures Exert Their Influence on the Culture

Bert: With the AT&T divestiture came significant new pressures. There
were major changes in three very crucial areas: competition, cost control,
and regulatory climate.
First of all, we had been a monopoly but now, for the first time, we
were going to have to compete for business. Did we know how t o be
competitive? We knew that if we were going to be competitive many
 Chapter 4 / The Pragmatist's Path: Bert's Journey 65

things would have to change. For example, we had heavy bureaucracy,

with levels and levels o f approvals for the simplest things.
Also, when we were "The Phone Company," we told the customers
exactly what they needed. We were in the driver's seat, not the customer.
Now we would have to evolve a new vision of what "customer service"
meant. But how do you change a culture that is so ingrained? That was
a major challenge for us.
Then the regulatory climate became even more strict and controlling
when the ATQT divestiture came. There was a climate of distrust. Now
that we were going to be profit-making the regulators didn't think that
we would have the best interests o f the customer in mind. They still
wanted us to retain our old style of customer service first-that philoso-
phy that I had been accustomed to. To ensure that, the regulators took a
certain position: "We guarantee you this rate of return so you need to do
what we say. We're the regulator." But the company's view was that reg-
ulation was essentially a replacement for competition, and now that
there was competition, the regulator role was no longer appropriate. This
was a major source of tension and it was ongoing.
So now we had the pressures of competition and regulation coupled
with the cost cutting that had begun earlier. We had to evolve a strategy
for coping with all o f these pressures.
In the 1980s (post divestiture) the focus was cost cutting and on
growing the core business so that we were better able to cover costs. In
the 1990s the focus shifted. The company was addressing questions such
as: What business are we going t o be in? What markets are we going to
be in? What technology are we going to use?
The company perceived that we needed to go in a more technically
advanced direction. Specifically, they wanted t o invest billions in fiber
optics and broadband. In order to do that, they had to take the money
from somewhere. They decided t o use the existing customer base-our
core, traditional business-as a "cash cow." The idea was t o milk the cash
cow in order to fund starting up these other business ventures which
might be more profitable. Therefore, there was an emphasis on reduced
growth o f the core; the core was t o become more and more efficient in
order t o fund other growth opportunities. Naturally, that put a lot of
squeeze on the budgets and put a lot of focus on finding places where
we could save money. As a result, we probably did some good in some
areas by trimming some o f the budgets, but we also had a lot of discon-
tent about service. Customer service was still a traditional telephone
company value and there was still a strong desire to focus on the cus-
tomer within the organization, but top management was focusing on
finding dollars to invest in developing the business.
So, there we were. There used to be a mentality of service a t virtu-
ally any cost, but now we came to believe that by cutting costs we could
hone our monopolistic bureaucracy into a leaner, more competitive oper-
66 Part 2 / The Journey

ation. We put pressure on people to cut costs. One of the things we did
was put a major emphasis on reducing the amount of time that we spent
with any one customer-because time is money, right?

Unintended Consequences
Bert: As a result of our focus on cost cutting, we did streamline our
processes and we became, in many respects, a model of efficiency. However,
this focus on streamlining had some unintended and unforeseen conse-
quences. Over time, we put a great deal of value on the physical processes,
on things we could quantify and measure, but we took it to an extreme and
as a result we tended to lose the human contact. We forgot about valuing
relationships.
You could feel this lack o f valuing human relationships by listening
to calls between our service representatives and customers. It showed up
in our reluctance to just spend time with customers and help deal with
their anxiety. It showed up in the mechanical way we'd relate to cus-
tomers by just following a rote script. For example, a customer would
phone in and we'd automatically say, "What's your phone number,
please?" And the customer would say, "Well, I've been out o f service, so
I don't-'' But we'd just repeat our script, "What's your phone number,
please?!" We'd forgotten our roots, and I believed that we needed t o get
back to those roots.

looking for a Way Out

Bert: As the cost cutting got tighter and tighter it became a ques-
tion of: How can we save even more money? Yet, despite those pressures,
some of us kept asking the question: How can we improve customer ser-
vice within this climate? How can we improve both customer service and
cost control?
In time I became the general manager of one of the business units.
As I said, I had been interested in customer service from the days when
I was climbing poles. Now I felt that I could finally begin to do something
about the service issue. I embarked on the Quality (Total Quality
Management, TQM) road. In my view, TQM meant "doing it the way the
customer wanted." I hoped to be able to use TQM to find a way t o bring
customer service back into the equation. But how would I start?
There were a couple of things going on a t the time. TQM had become
viewed as a good thing a t my company, but the approach we were tak-
ing was very conceptual and theoretical because it was being led by a
staff person who was a very conceptual thinker. This conceptual
approach didn't do it for me because it wasn't directly linked to our work.
I was adverse big-time to theory for its own sake. I was in the line and I
needed something that was tangible. I needed to see it in action, to see
 Chapter 4 / The Pragmatist's Path: Bert's Journey 67

it actually working. Why do I need to reinvent the wheel or even create

the wheel?
I was certain that we could learn from other companies who had
already made Quality improvements, but I had some roadblocks. We had
a major belief that you couldn't bring in innovations from another indus-
try because the phone company was unique. Yet, we couldn't look to
another phone company because none o f the phone companies had par-
ticularly distinguished themselves in that regard. Because we'd all been
part of AT&T, there wasn't a lot o f fresh thinking. Then I heard about
Florida Power and Light.
Florida Power and Light was doing some first-rate Quality work. They
were the first and only American company to win the Deming Award.
They were also instrumental in creating the Baldrige Award. When I
looked a t the company structure, I saw that they were very similar to us:
they had business offices, splicers, trucks, cables, underground and aerial
lines, linemen, unions, e t cetera. They had all the process we had and
they were also regulated. Power and phone companies have similar oper-
ations, and similar ways of looking a t the world. Because they had been
so successful I said, Let's go see what they're doing.

A Vision o f How It Could Be

Bert: In 1990-91 I went to Florida Power and Light and met for about
half a day with the president. He explained the visions and values and TQM
principles that they had there. It sounded pretty good, but I was still a lit-
tle skeptical. Then at the end of the day when I was leaving to go back
home, I saw a Florida Power and Light worker working at the side of the
road. I stopped and engaged him in conversation. I asked him some of the
same questions that I'd asked the president. What was amazing to me was
that I got the same answers.
Now, I'm not saying for a fact that the worker and the president used
the same scenarios or spoke at the same level or scope, but the same
phrases and words were part of both people's answers. I thought that
was pretty good. For the first time I'd seen that what the executive rank
was talking about, the working rank was also talking about, and that
established that there was a golden thread linking all the goals and
objectives of the company from top to bottom. That seemed rather
unique because that wasn't my experience in my company. In fact, in my
whole career I had never experienced that degree o f congruity, the abil-
ity for the top-level management and the rank-and-file t o actually
articulate the vision, values, and quality principles in the same terms.
That experience gave me a vision of what could be-and also told me that
the vision was achievable. As a result, I introduced the Florida Power and
Light TQM system into our company.
68 Part 2 / T h e Journey

It was a rough road for a while. Our company version o f TQM had
eleven steps whereas the version from Florida that I was trying t o intro-
duce had only seven steps. So, instead o f focusing on the essence o f TQM,
some people were fighting about which one was better and which one
we should use. But I had a trump card. I was in a line position a t the time
and in this culture, the line position tended to have more weight than
the staff position.
I also was reporting to a VP who was very well respected because o f
his grasp o f the financial aspects of the business. We were facing major
financial problems, as I mentioned earlier, so his expertise was very val-
ued. Ultimately, he became the Chief Financial Officer. And since he was
an officer-and in those days it made a difference-he had credentials.
So I was a line guy with the ability to speak through an officer who
was a financial expert. This was a powerful combination. My boss
became a champion of TQM and he made it clear to the rest o f the orga-
nization that TQM was something that wouldn't go away. So, in our busi-
ness plan, we made TQM the anchor of all the programs for the follow-
ing year. He made it a fundamental strategic imperative for the business.
At last I had some leverage to do the things that I felt were important.
We had credibility.
Iva: So you were able to implement a t PacBell the things you had
learned at Florida Power and Light.
Bert: That's right. It was a Total Quality infrastructure.
h a : This is sort of, I wouldn't say identical, but very much like what
I did. I got into Senge's work from TQM. I thought Senge's work was
going to help me with TQM.
Bert: That's exactly what I thought. The very next year, I went to the
Program for Senior Executives a t the Sloan Business School a t MIT, a
three-month, live-in course. We had a bunch o f professors there from
both inside and outside MIT, one o f whom was Peter Senge who had
recently published The Fifth Discipline. Another was John Sterman who
had done a lot of pioneering work in simulations.
I was concerned that we were improving processes that had no busi-
ness existing. After listening t o Peter Senge and going through the
courses, I began to see how organizational learning could complement
our TQM work. I saw that we could use systems thinking to help us fig-
ure out whether our processes were really useful or not. Then we could
use TQM to improve them.
There was something else that also clicked for me. I realized that we
were potentially firing people because they weren't accomplishing cer-
tain things, when the failures really didn't have anything to do with them
as individuals. It was the system that was creating the negative out-
comes, not the individuals. It could have been anyone in the shop. After
you do the Beer Game you find that out real quickly because you expe-
rience it yourself.
 Chapter 4 / The Pragmatist's Path: Bert's Journey 69

M y colleague Dan Mlakar had some interesting insight into that

issue.
Dan Mlakar, Project Manager: People often thought they
could fix things by finding an individual to blame. The only
method they had for solving problems was to shift responsibility,
shift the burden, point the finger and find blame. They had no
real understanding that there might be another approach.

TQM and Systems Thinking: A Powerful Combination

Bert: So, I could really see how both systems thinking and simulations
could take us much farther on our Quality journey. Once I had a sense of
what organizational learning was about, I asked Peter Senge to come to
PacBell because I felt strongly that we needed to work together on this for
my company. Peter responded, to my surprise, that he was already there.
Unbeknownst to me, Peter had been brought to our company by one of our
vice presidents. I told Peter that I didn't know a t all what he was talking
about, but when Peter mentioned the name of the VP, I recognized him.
That night I phoned the VP t o find out what was going on and, sure
enough, the individual said that he was engaged in an organizational
learning project, and that it was a kind of "skunkworks" project. He also
said that there was "lots of stuff around it" and that we should talk when
I returned to California. That led to a discovery.
In a subsequent conversation with the VP I learned that the presi-
dent o f our company, who was very interested in the TQM movement a t
that time, had seen an article by Daniel Kim a t MIT. The article suggested
that systems thinking could enhance TQM; in fact Kim suggested TQM
would fail without systems thinking.' After reading the article the pres-
ident took a strong position against our getting involved with systems
thinking because it would distract us away from the things that we were
doing in TQM.
h a : What was your own feeling, Bert, about this controversy, about
TQM and the way that Daniel Kim had framed it?
Bert: Well, for me, TQM had to include a focus on customers. Yet,
very often in our company I'd hear TQM being discussed in very abstract,
numerical terms. I'd hear people talk about things like numerical TQM
and statistical process control. I personally had the feeling that our
approach to TQM was limited, so Kim's argument seemed logical. I still
didn't understand the president's resistance-but eventually I figured i t
out.
You see, there was more t o the president's resistance than just that
article. We had had a unique experience in 1988 with a company-wide
training program called Leadership Development. While the program was
being implemented, a lot of the employees objected t o it, but manage-
70 Part 2 / The Journey

ment did not listen or deal with those objections. As a result, the employ-
ees went public with their concerns. They went to the press and to our
regulators with the complaint that "They're trying t o brainwash us.
They're trying t o change our thinking." In fact, the Leadership
Development program hud been about changing our thinking and now
there was a lot of fear in the organization about things like that. Then,
some people made a connection between Leadership Development and
systems thinking-and, therefore, between leadership development and
organizational learning. I believe the president wouldn't embrace any-
thing having to do with systems thinking because it might conjure up the
memory o f Ieaders h ip develop ment.
So, the president was very concerned that the TQM initiative would
be diluted by the systems thinking work. Meanwhile, this VP was doing
the skunkworks project without getting the president formally involved.
It turns out, however, that the president knew about the project and was
lukewarm about it. This came t o a head and the VP left the company. The
VP later said that he had pushed too hard a t the wrong time and in the
wrong place. As you might imagine, this had a major impact on my
approach to organizational learning. I felt that this was a warning to me
that this stuff was dangerous. I was fearful that I could lose my job.
After this happened, I faced my first challenge. O f course, I was
aware of the risks, but I was still very excited about the potential o f OL
and I was confident that I wouldn't make the same mistakes. I went to
my boss (who, thankfully, also had some background in OL) and said, "I've
got to do this." I figured that I had certain advantages. On the plus side,
I was a line manager, and in the culture o f PacBell a line manager has a
lot o f say. That put me in a better situation politically than the previous
champion who came from accounting, which is not seen as part of the
mainstream.
But the irony was that my being a line manager didn't give me the
opportunity t o exploit OL work because my boss and I agreed that it was
more appropriately done in staff at that point since the line is supposed
to focus on day-to-day implementation, not company-wide process
improvement. So OL went dormant for a while.

The Journey Resumes

Bert: About a year later I got a staff job. I became the Bold Goals and
Customer Service Bureau Assistant Vice President. Our corporate journey in
TQM had continued. M y interest in OL had been sustained even though I
hadn't been actively involved. I still saw a lot of potential in making the link
between TQM and systems dynamics, but it wasn't until I actually came into
the staff job and started working on some major corporate initiatives, which
we called "Bold Goals," that I felt that I could resurface organizational
learning. These initiatives aimed a t making major changes in the business. I
 Chapter 4 / The Pragmatist's Path: Bert's Journey 71

thought that OL could help us achieve those goals, so at that point I went
around looking for what happened to it. I found that the skunkworks had
sort of continued, but a t a very minor pace.
I told my boss what I wanted to do and I also got the VP of Quality
involved. To make it clear what the strategy was, I drew a diagram that
basically showed that systems thinking was an extension o f TQM, not
anything which is antithetical to TQM. So OL work would not create any
kind of diversion from the TQM path.
The VP of Quality and my boss decided to tell the president what I
was up to in order t o get his sanction. The president sent back the mes-
sage that he wasn't crazy about it, but we could go forward as long as
they gave him some guarantees that this would not be the preeminent
part of my life. M y boss's counsel to me was to go ahead, but cautiously.
"Don't make it a mainstream event," he said. M y boss also reminded me
that I had a job to do and that I had business results to deliver. He also
reminded me that my evaluation would not be based on how well I
implemented systems thinking but on the metrics attached to the spe-
cific tasks that I had been assigned.
At this time, I believed that my new job function gave me a good
opportunity t o do more organizational learning work, and it did. We had
four trial organizational learning projects during my watch. Two of them
failed miserably and t w o were extremely positive. I learned a great deal
from each of them.

The First Project Attempt

Bert: In the beginning my thinking was pretty idealistic in the sense
that I was very enthusiastic about the potential for OL to have an impact
on my company, but my thinking was also very practical. From my past
experiences with TQM, I had learned that I needed a practicalplatform from
which to launch OL. I had learned that one of the problems with TQM was
that people didn't have time for it because they didn't perceive it as real
work. They had their real job to do so they couldn't go to the Quality
Improvement meetings. I always found this very exasperating.
One of the Bold Goals was something called "trouble report reduc-
tion." The objective was t o drastically reduce the number of requests for
customer service because a customer is experiencing trouble on the line.
I believed that this initiative represented a genuine opportunity for col-
laboration between our company and the Organizational Learning
Center a t MIT (MIT OLC).
As i t turned out, a staff manager who reported to me had begun
some work on a service quality management flight simulator at the MIT
OLC, but there was no momentum to keep it going. These circumstances
triggered my interest in how a specially focused, systems dynamic-related
project may be able to help reduce trouble reports. I wanted to get a field
team together to validate the work, so I went in search o f support. First,
72 Part 2 / The Journey

I got support from my boss, an executive VP, and then I pursued the OL
folks at MIT.
We engaged in a discussion about working together on a pilot project.
Together, we hoped to build a service quality simulator to help us reduce
the number o f trouble reports. The next step was t o get support from a
line organization. The project never came about. I attribute this failure
largely to the way organizational learning was introduced to our people.
What happened was that some people from the Organizational Learning
Center a t MIT came out to meet with us for a so-called Project Definition
Clinic. Our initial attempt a t a conversation was, I believe, a fiasco. The
clinic was too unstructured for us and our people got nervous. We were
a bunch o f top executives sitting around a table, and the OL people said,
"Well, now we're going t o discuss the undiscussables." From my training
in OL, I knew that the idea of talking openly about things that are usu-
ally not talked about is important within the context of OL, but that was
the wrong thing to do in our culture. We were not open to such an
approach. Discussing undiscussables and dealing with culture first is the
opposite o f the way things worked in our culture. We were there t o do
business. So it absolutely did not go over well. The problem was com-
pounded when the MIT folks told us that the staff manager and I had a
lack of communication-which I felt was untrue.
The line people put up strong defenses against getting involved in
the learning work. We had a subsequent meeting, but things got no bet-
ter despite my best efforts. Then, during the meeting, the line VP stood
up and said, "This better not have a negative impact on results." That was
a warning signal. Then he said he was going to "play the devil's advocate
role," and I knew that meant he wasn't buying in. I knew the project was
dead.
I still didn't quit. After the meeting I talked with the line VP and
explained to him how important this OL stuff was. I worked the whole
road, you know? I said, "Look, you gotta do this." And what did the line
VP do? He went t o my boss and my boss backed down. M y boss saw this
as a test-and we didn't pass.
Now, my boss had shared with me that there was concern that this
project was all I was doing. He knew this was dangerous because there
were other more mainstream activities, such as Quality Improvement
Teams (QITs), that were seen t o be more important. He was concerned
because he knew that others should view this not as something sepa-
rate, but as part o f a larger TQM initiative aimed a t achieving the Bold
Goals.
Naturally my boss saw the line VP's coming t o him as a confirma-
tion o f my being too involved. So I lost leverage there. I remember being
really upset a t myself after that. I kept asking myself, "Why don't they
see this?" I took it very personally. I felt responsible for not being able
to make it work. I know now that I should have done it differently. I
 Chapter 4 / The Pragmatist's Path: Bert's Journey 73

should have not pushed so hard, but I was so revved up and I believed
that I needed to persevere.
Reflecting on it further, there were huge differences in perspective
between the university people and our people. The OL leader's primary
question was "How do organizations learn?" whereas mine was "How can
a learning project benefit my organization and its goals?" In a sense, the
OL folks' reaction to us reminded me o f our old culture; it was their way
or the highway. So perhaps these differences represented an insur-
mountable obstacle.
Then there was also the issue that programs targeted at modifying
people's basic values, especially any with "thinking" inherently in the
title, had became a taboo a t Pacific Bell due to the fallout of the
Leadership Development program. Another claim was that it was dis-
tracting them from doing their regular jobs. This was even truer in the
line organization.

Learning from a First "Failure"

Bert: So, basically, my first attempt a t gaining momentum around an
organizational learning project was a fiasco. It was a total disaster in my
mind. One of the factors was, in fact, my enthusiasm for what organiza-
tional learning could do for us. Because of that enthusiasm, I tended to
overreach. I called Peter Senge to come. I brought out all the ammunition,
the whole parade. I took the attitude, "I am bringing you the prophet from
the mountain." I came in as the zealot and as a result I missed some cues.
For example, the vice president in charge o f the line organization did
not volunteer; I asked him t o participate. At the time, the line organiza-
tion also had 17 other initiatives that they were responsible for. So, o f
course, their commitment was very tentative.
h a : That is a critical question. Can you create commitment or does
i t need to be there in the first place? And if you don't have commitment
in the line from the get-go, should you even begin?
Bert: M y colleague, Dan Mlakar, has the view that you absolutely
need proactive, creative line people. He says that you need people who are
"close to the resources and close to the results." These people need t o be
able to balance practice and performance. He believes that this is a pre-
requisite-creativity and commitment must be in the organization in the
right place. You can't create it; i t has to be inherent in the make-up o f
people. You've got to find the people and line leaders who have it already.
Iva: I almost agree. I don't believe that you can create commitment,
but I do believe that, as a leader, you can create the conditions where
commitment can take root. So I guess I believe that even i f you don't
have it a t the very beginning, you still might be able to start something.
Bert: Perhaps, but it's a lot riskier. I also learned that OL was not
going t o fly on its own, that its inherent value was not transferable from
74 Part 2 / The Journey

all those OL meetings that I'd gone to. I had been persuaded in those
meetings about how positive everything was. I'd set myself up in my own
mind that all I needed to do was let these people know what this is.
It was at that point that I realized this stuff is dangerous for me. I
also learned that the line folks wouldn't support the project because they
saw the approach as being too unstructured and therefore they believed
that it would have too negative an impact on the numbers. So, I realized
that if I attempted anything else it better be supported by numbers.

Regrouping
Bert: I still had the Bold Goal of reducing the number of trouble reports.
How was I going to approach this goal?
In order to decide on the best strategy, I felt I had to do some analy-
sis work. I decided to do a SWOT analysis: I looked a t the strengths,
weaknesses, opportunities, and threats (SWOT) of our current situation
overall. I came up with the information shown in Table 4.1.
First, I looked at what the company valued. At this time it was defi-
nitely cost reduction. In fact, the majority o f Bold Goals were cost-
driven, so I knew that cost reduction would have to be a major part of
my strategy. But I held customer service in high value, so I did some
analysis to see if there was a customer service angle and, of course, there
was. When a customer complains about trouble on their line, cost reduc-
tion and service certainly overlap. Customers don't want t o have trouble
on their line, and every time they do we need someone out to fix it. That
costs money. So, if we can find a way to reduce reports of trouble, then-
theoretically, a t least-both customer dissatisfaction and cost reduction
can be si mu Itaneously improved.
The next thing I did was I looked a t our assumptions. There were
some aspects to the way that we traditionally handled trouble reports
that were considered to be "Motherhood." I mean, they were just unas-
sailable. For example, when we had a customer calling in with a report
of trouble on the line, we'd dispatch a technician and then measure how
long it took the technician to fix it. We held each individual tech respon-
sible; we never looked at overall patterns. We'd get reports daily on how
long it was taking each o f our techs and whether or not they were able
to fix the problem. Then we would have a formal review.
During the review we'd actually drag in the technician who worked
on the customer order and we'd grill that person for having screwed up
on a customer call. We used t o call these the "TELSAM barbecues"
(TELSAM stands for Telephone Service Attitude Measurement, a survey
that was considered to represent the voice of the customer).
The barbecue was our method for reducing trouble reports. I learned
from the Beer Game that it doesn't make a difference who you put in
there. Given my background as a service technician, and my experience
 Chapter 4 / T h e Pragmatist's Path: Bert's Journey 75

Table 4.1
Bert's SWOT Analysis

STRENGTHS: WEAKNESSES:

.. Results driven
Customer-oriented .. Reaction-timedriven
First-cost driven

. Employee technical ability

Employee loyalty
Regulatory confrontation
Shadow of Leadership
Dominant market presence
.. Development
Business unit fiefdoms and rivalry

.. Hierarchical decision making

Monopoly thinking
Line versus staff friction

OPPORTUNITIES: THREATS :

..
New union-managementrelationship
Frustration with current results . Competition
Legislation
New idea champions
Industry technology innovations .. Customer disenchantment
Regulatory sanctions
Declining profitability
Adverse financial rating
Higher than expected employee
early out

with the Beer Game, I knew that this wasn't the answer, but what was?
I believe that we could learn something about this if we applied OL to
this Bold Goal.
The SWOT analysis helped me clarify my working assumptions. I
identified some leverage points and came up with some strategies to
deal with them. For example, our focus on results meant that we could
not participate in learning for its own sake; learning had t o be tied to
results. First and foremost, we were cost driven so we had t o make sure
that the initial cost for learning was very low t o nothing. There was fric-
tion between line and staff, so we didn't do anything that exacerbated
that. We were hierarchical in our decision making. The implications were
that we had t o make sure that we involved our peers and didn't ever go
over their heads t o their bosses or we'd alienate them.
Also, the Leadership Development experience had left a shadow so I
knew I should distance myself from any comparison t o anything like it. I
also knew I had to be careful about how we brought OL in, because it can
look pretty foreign to our culture. I took that into account. For example,
I determined that we should eliminate all the OL jargon except during
our core group meetings.
That's how I processed all the weaknesses and threats. The opportu-
nities represented the possible portals-the openings for learning. I per-
ceived that those openings were small now, but they could grow larger
as our frustration with results increased.
76 Part 2 / The Journey

Finally, I believed that I needed t o get some protection for myself.

After all, things had not gone well for the early proponents of OL and I
didn't want to find myself without a job. I had a real heart-to-heart talk
with my boss and told him what happened from my perspective. I said,
"We've got to work out air cover around here because this is good stuff,
but it ain't easy t o introduce." "Air cover" is a term we used to describe
getting some protection from someone higher up in the organization. The
role of your air cover was to listen t o any perceived negative impact of
things you were doing and to tell you the things that weren't being said
to you directly.
M y boss agreed t o provide air cover and he also gave me the confi-
dence that I wasn't going to be fired, but that I had better learn from this
experience. "Major in the majors," he said. "Don't try to make this main-
stream." M y boss was smart in the sense that I don't think he was total-
ly convinced that this was good stuff, but he had enough wisdom to let
me find out for myself. So now I knew I had t o find a different approach.
And I did.

Going Undercover
Bert: I decided that I would begin again by forming a team and then
practicing organizational learning within my own group, rather than try
to involve an outside group. So I put together a team around the concept
of the spokes of a wheel. I found people who had different areas of
expertise. They represented the different spokes. M y job was to stay in
the hub and remove barriers so that they could do their jobs t o the best
o f their abilities.
We started developing a learning group, or a "community o f prac-
tice" to use the jargon. In particular, I decided that I wanted to use causal
loop diagrams to help us come up with a diagnosis of the situation and
then a strategy for intervention. M y plan was t o pull in a line expert and
an expert in causal loop diagramming and have them talk to each other.
As we were working together, practicing some OL techniques, I
began to notice a rather dramatic change in the group. For example, our
culture was very hierarchical-like the military, the number o f "stripes"
you had defined your reality; people would defer to the ranking individ-
ual. It could be a very tense environment. I used t o have a pet phrase that
described it. I'd say, "My boss is a six and I'm a five and a six beats a five
any day o f the week." But within our group that wasn't true anymore.
One day when we were a t a meeting somebody commented that we were
listening more. And that we were challenging each other more, but we
were challenging the ideas without challenging the individuals.
People began t o see that there could be another interpretation of
reality, there could be another way o f being. We also began to see that
we were no longer as competent as we thought ourselves to be and that
 Chapter 4 / The Pragmatist's Path: Bert's Journey 77

the methodology by which we had been promoted to our vaulted posi-

tions was not necessarily the methodology that was going t o be suc-
cessful in the future. All that made people very willing to listen.
We had new insights. For example, we had a problem with our cables
getting wet and so we put a lot o f effort into extracting water. We real-
ized that a better approach would be to work on preventing water from
getting into the cable in the first place.
We also got more into group decision making. I believe that we actu-
ally made better decisions. We used the OL language, we all understood
each other. So in that sense, it was good.

The Second Project: A Major Success

Bert: The trouble report reduction project required us to find a line
manager who would work with us and allow us to do some field investiga-
tion. M y job was to cultivate this line hero and create a relationship that
would enable us to do the manual tracking of data that was required to
support our theories. In this way, we went around the hierarchy.
Once I found the line hero we had all the pieces. We had an expert
from the line and an expert in systems thinking diagrams, so we had
someone t o tell the story and someone to draw the diagrams. We began
to draw systems diagrams o f how things were really working out in the
field.
It was like playing detective. We started with the TELSAM barbecues
because I was really convinced that we were picking on the front line and
I didn't think that was right. I learned from the Beer Game that it doesn't
make a difference who you put in there. And we were killing these guys.
It had to stop. I was convinced that they were not the problem.
So, if our TELSAM results showed that customers were saying that
we weren't making repairs fast enough, what could be other reasons
besides the speed o f the actual repair guy? That question led us t o look
a t how the repair guys fix things. When the systems diagrams were done,
we all looked at the pictures. We saw that all the arrows were coming
into one spot. It was crystal clear what was going on.
It turned out that how the repair guys fix things was driven by pol-
icy. The policy was driven by a set of assumptions that we now began t o
question. The company believed that customer satisfaction in this area
was a function of how quickly the repair was made. Therefore, the offi-
cial policy was to make the repair as quickly as possible. The unspoken
policy was that we'd punish-or barbecue-our technicians if our TELSAM
results showed that customers weren't happy with our repairs.
The trouble was that we unknowingly created a system wherein nei-
ther the customers nor the technicians could win. That was because we
didn't really understand what our customers wanted.
7a Part 2 / The Journey

Aha!
Bert: The systems diagrams helped us discover that our customers
weren't looking a t how long i t took us to fix a single, isolated case; they
were looking a t whether the problem was fixed forgood. And, due to our
policy, it very often wasn't. The reason was that we never really repaired
the problem, we just switched them t o a new line. We focused on a quick
fix rather than identifying the root cause of the problem and solving it.
We didn't look for the root cause of the problem because that would
have taken more time and more of our critical resources-at least in the
short run.
Then we had another "Aha!" We realized that as we continued to
switch customers over to new lines without making permanent repairs,
we were reducing the capacity o f the cable. Eventually we ran out of
cable. That meant we had t o go and place a new cable-which meant
that we shifted the burden again, this time from one organization to
another. Laying more cable was Engineering's problem; i t no longer
belonged to Repair. The burden shifted from one organization's budget t o
another's-and yet we kept blaming individuals.
The causal loop diagram in Figure 4.1 was a seminal document. It told
the story, showing how the TELSAM measures, customer satisfaction, the
barbecues, and the physical issues of the trouble reports all interacted.
This shared, systemic picture of reality gave the team the ability to
challenge the TELSAM barbecues because i t showed very clearly that the
way we were interpreting TELSAM was wrong. For example, customer
comments like "Not fixed the first time" were made not because the
technician screwed up, but because of our policy. We "repaired" a cus-
tomer complaint by switching the customer t o another twisted pair in
the cable-which meant that the problem wasn't really fixed for good. It
would occur again. Sixteen percent o f our customers said, "Every time it
storms, I lose my telephone service." A customer's comment that the
repair "took too long" was based on their definition of time versus our
definition of time.
Not only that, we were exhausting all our repair forces and a t the
same time creating more work for Engineering! It was all right there on
the systems diagram. The diagram also showed that the TELSAM barbe-
cue was the result o f this inappropriate measurement. It focused on the
technician, not the experience of the customer.
The other thing that became clear was that customers didn't under-
stand why all this happened. And the truth was, we could anticipate
these problems. The reason we didn't was because we looked a t each o f
these trouble reports as individual, isolated cases, not as elements in a
pattern. Could we, in fact, find out about the problems ahead o f time?
The answer was, "We never really looked, but sure we can!" This is the
issue of preventative versus reactive maintenance, which eventually
became a key focus of our intervention.
Chapter 4 / The Pragmatist's Path: Bert's Journey 79
80 Part 2 / The Journey

Our next step was to go out into the field to verify this picture. We
talked with the people in the field and asked: "Is this really what hap-
pens? Is this really how we do it?" They helped us confirm that our pic-
ture was correct.
Once we verified everything in the field, we had the ammunition we
needed to challenge some assumptions. Our measurement system was
considered to be sacrosanct, but we started saying to people that there
were flaws; it wasn't necessarily measuring what we thought i t mea-
sured. We had been misinterpreting the results and coming up with bad
policy as a result.
Dan Mlakar: People began to acknowledge that the mea-
surement contributing to the TELSAM persecution in the field
was broken. Until it was fixed, you couldn't improve service. You
needed to break the cycle of blame, to speak with data and facts,
and to bring in another method o f improving service beyond
TELSAM.

Proving Our "Hypothesis"

Bert: One of the VPs was a big proponent of TELSAM and we argued
about it. He challenged me and I said, "You've got to trust me on this." But
he said, "You prove it t o me." So I said, "OK.Give me a group in the field and
let me direct them. We will prove it. Let's watch those results." That was the
whole ethic of the business at that point. You prove i t and you can go some-
where.
This VP had confidence in me because I came from the line, so he
gave me the field group. O f course, this was a risk. M y credibility would
have been zero if this hadn't worked, but I believed in what the data was
showing. Especially when I saw everything coming together on the sys-
tems diagram. I also believed that I had minimized extraneous risk by
pulling in competent people t o drive it, because you always run the risk
of having the right idea, but implementing it badly.
So I took the risk and it paid off. We did a pilot based on our theory
and it worked. It came through like gangbusters! We got a 26 percent
reduction in trouble reports, and saved the company millions of dollars.
As a result, we changed the practice o f the TELSAM barbecues, which
had been our method for dealing with trouble reports for years and years.
It was finally abandoned because we were able t o use systems dynamics
to show that the practice was actually counterproductive and did not
solve the trouble report problem. Instead, preventive maintenance
became a big thing. We identified a number o f interventions and we did
most of them.
This project worked because we had all the ingredients of success:
We had hard data.
 Chapter 4 / The Pragmatist's Path: Bert's Journey 81

The project was done by a line group though it was directed by the
staff group.
We had theory behind it (shown in the causal loop diagrams) that
drew on practical expertise.
We had demonstrable results.
These were all things the company valued.
Because o f this work, I was made Service Policy and Quality Vice
President. Our achievement made me even more certain that proving it
was the secret to success. But I was about to learn that even that con-
viction was up for grabs.

In Search o f a Strategy: The Challenge o f Diffusion

Bert: Because we ended up being very successful with the trouble
report reduction project, I wanted to take i t to the next step. I wanted to
give all our district managers the means to get those same results. M y
enthusiasm for this came out of the highest principle o f TQM, which was
t o share and replicate. So my next step was t o find an effective diffusion
strategy.
Dan Mlakar, who had been the systems thinking guru on our team
and was also very committed to 01, suggested that we engage all the
district managers in a learning process using the causal loop diagrams
we had created as a tool to facilitate their learning about the patterns
we had discovered. I didn't agree with that approach. I didn't think it
would lead to a successful diffusion. First of all, I knew that ''learning''
wouldn't be considered mainstream and it would therefore be suspect.
Secondly, I didn't want to take this causal loop diagram around and try
to explain it t o each of them. We had tried that when we first went out
in the field, but we found that people found the diagrams very confus-
ing. They weren't accustomed t o thinking in loops and they were con-
cerned that drawing diagrams wasn't "real" work.
Again, I was assessing our culture. M y view was that you have to
build your change strategy on the working model of how change actually
happens in your organization. Therefore you have to see the culture
you're operating in as clearly as you can and accept that culture as it is.
I have a strong belief that you need to work with the culture, not against
it. I've long been a believer o f the biological rejection phenomenon.
M y assessment was that our organization had an immediate gratifi-
cation-type culture. There was a very low tolerance level for trusting any
kind o f process that people didn't easily understand-like systems dia-
grams. Secondly, my organization was geographically dispersed through-
out California, and I knew it was very difficult to replicate a successful
practice from one location to another, largely because o f resistance.
Everybody feels that their area is different.
82 Part 2 / The Journey

On top o f that, my working assumption (based on my SWOT analy-

sis) was that there were only t w o reasons why this company would ever
adopt anything new. The first reason was because somebody in authority
said to do it. That's the "push" strategy. Anything that was blessed from
on high had a better shot a t getting done-although even that didn't
always work because, again, there was lots o f resistance on the local
level.
The other reason was because somebody got tremendous results
doing something different. That's because this culture was very success-
oriented. It was a very "show me" culture. It required a lot o f data and
results. And it was more averse to risk than you would normally expect.
The good part o f that was that once you had the data to prove that you
had results, the innovation tended to be adopted and readily diffused
throughout the organization. But until that time, it only took one or t w o
people, a t any level, any place, to shoot it down-and there was a natural
tendency to shoot it down. The devil's advocate position was alive and
well.
I wanted t o create that "pull." That's why I had t o first prove that it
could be done-and we did. My initial theory of change was pretty sim-
plistic, and it was also idealistic. It was something like the movie Fieldof
Dreams. You know, "build it and they will come." And it seemed to be
working. After we had the original success with the trouble report project
a lot o f people said they were interested in getting those same results.
But then I realized that it wasn't that simple. That's when it became clear
to me that they wouldn't try it unless I could prove to them that they
could be successful with it as well. How was I going t o do that?
I got the idea that I had t o get our innovation packaged into some
kind o f vehicle that would enable the results t o be easily mass-produced
yet a t the same time be customizable by the various field groups. I
thought I could accomplish that by developing a simulation. My thinking
was that if people saw a simulation-a model-that they liked, and if they
saw that it could bring them better results, they might go for it.
I was personally very excited about the potential of simulations in
our company. A simulation could get to people's personal belief systems.
I believed that I already had a lot o f intellectual, conceptual agreement
a t the company t o the fact that we had lots of examples of poor deci-
sions and no way t o simulate the results beforehand. So my plan was to
create a simulation model that would enable us t o spread the innovation
we'd had with trouble reports to all of the business units.
We spent a lot of money and a lot of time working with someone
from MIT, but it all came to naught. In the end, the model couldn't meet
expectations-despite a whole year o f work. That was very disappointing
because a lot of line people came t o see the model as it was progressing
and they indicated a high degree of interest. I really think that if i t
worked we could have broken through.
 Chapter 4 / The Pragmatist's Path: Bert's Journey a3

That failure of the simulation put a negative spin on organizational

learning. It came down t o a simple equation: If OL can give us the right
results, then it is good; if OL can't give us results, then it is bad. I wasn't
able to leverage the positive results that we had with our trouble reports.
I believed that our success was directly attributable to OL, but we were
not able to make the results replicable. I was really disappointed.

Learning, Again
Bert: I realized that I had become so excited about the success with
trouble reports that I made a big jump. We had proved the concept! We
published results and I got a lot of people hepped up about it. We saved mil-
lions and millions and customer satisfaction went up and everyone got a
reward. We were heroes! I was so euphoric about the success that I wasn't
disciplined in my thinking. I made some assumptions. In particular, I made
the assumption that I could use a simulation to replicate the work my team
had done in the pilot. This was a major leap because when we did the pilot
my team and I went out in the field and gathered a lot of new data. We
worked directly with people to make sure that we were capturing all the
accurate data. It was very laborious, very hands-on, and manual as hell.
We couldn't do that for every district, and the other district man-
agers refused to do all the manual data tracking that we'd done in the
pilot. They said, "We're downsizing. I'm not going t o take on a manual
tracking process." So we were in a bind. I had to develop a simulation but
I didn't have the data. So what did we do? We tried to build a simulation
without sufficient data.
In my view, it was a disaster. I didn't understand that it was like
going from a laboratory environment to an industrial strength environ-
ment. We really had dual requirements: to make i t user friendly, and also
to make it data rich. Because the model was incapable o f dealing-or we
were incapable o f dealing-with those dual requirements, the simulation
fell down. Dan Mlakar has another perspective on what happened.

Dan: The problem was that the people in the field didn't
really want a simulation: they wanted a black box that would
tell them exactly what countermeasures would produce these
kinds of results for them. They wanted t o be able to bank on it.
We didn't have the data to do that for them so we ended up
building something in between a simulation and a black box. I
think we realized there was tension between the black box that
everyone wanted and what we could actually deliver.
Iva: So the original idea was that each o f the district managers could
select his or her individual variables and come up with a formula that
was right for him or her?
Bert: Right. And customize it.
a4 Part 2 / The Journey

Iva: Was there another approach you might have taken?

Bert: As I said earlier, Dan had suggested another approach.

Dan: Theoretically, we could have taken more of a learning

approach. Rather than try to turn the simulation into a black box
or a decision support tool, we could have used it as a microworld
for trying out policy and strategy with Bert's peers. Then people
could have thought about what they needed from the top and
the bottom of the pyramid to make it happen.
It's hard to position anything successfully like this "down in
the mud" because people in the mud are going to be looking for
answer machines.

Iva: I see a dichotomy between a) taking a learning approach-which

says, if we all learn together we can better deal with the world we're in-
and believing enough in your people that they'll respond to that, versus
b) short-cutting the learning and providing people with the answers.
Maybe I'm being simplistic but that seems like what you were trying to
do.
Bert: I was very convinced that taking the learning approach in this
environment would get us nowhere. In fact, it might get us in a lot o f hot
water. So I wasn't going in that direction.

Dan: We didn't have the freedom to expose people's think-

ing and to ask questions like, what do you think is going on
here? We didn't have the freedom to expose mental models or
double-loop learning. We could only take it as far as Bert was
willing t o take it. And I guess we knew that a generic learning
experience would go over like a lead balloon, so we tried t o move
toward something we called a decision support tool (DST) that
would help people make decisions and see the impact if they
spent money on countermeasures. We tried to build something
too comprehensive and because we lacked real data we guessed
how to quantify things. We got caught in the middle. You don't
want t o be caught in the middle in terms of any kind of market
positioning.
The simulation was not successful because the field people
wanted a black box. They wanted so much more in the model
than we could ever build. They wanted to know things like: What
is the cost-benefit o f each countermeasure? We couldn't deliver
that, although we tried.
But Bert was very clear about his approach: Build it and they
will come; prove it and they will come. I understood this
approach and we stuck with it. So, that's the road we went down.
 Chapter 4 / T h e Pragmatist's Path: Bert's Journey 85

The Challenge of Building to Critical Mass

Bert: All the while I was thinking that here was this success, but it was
isolated to the technical world. Yet, I was still holding in my mind this cor-
porate transformation that I wanted to have. I realized that in order to have
any real effect on the business you have to involve the whole delivery chain,
those departments that are each other's customers. So I began to invite
people from various other groups to go to OL training.
The intent was t o try and seed OL throughout the company. I thought
if I could build support in other organizations, eventually I could build
critical mass. Yet it seemed that OL would attract only a certain type o f
person-the ones who are already open, or at least searching for some-
thing beyond the normal way of doing business. The rest really require
that the value of OL be proven to them, in terms they understand and
relate to. So I kept trying. That's why I tried t o get a project going with
AT&T.

The Third Project: A Failed Collaboration

Bert: My third try a t an OL project was an attempt to create a partner-
ship between our company and AT&T. Now that we were divested, we had
problems dealing with them. AT&T complained that we weren't giving them
a lot of business. But we were fearful of dealing with them because we
didn't know how to approach them. Were they a customer? A supplier? Or
were they a competitor?
I knew AT&T was also involved in OL, so I thought this was a natural.
I thought that by bringing OL tools to bear on these questions that we
could bring more clarity to the relationship. We began a series of meet-
ings between representatives from our company and representatives
from AT&T. The purpose of the meetings was t o discuss the relationship
between the t w o companies and to look at how we can best work
together as supplier, competitor, and customer.
After the first two or three meetings, an AT&T representative came
back and said, "The ATQT people don't want to play any more." The AT&T
representatives were all salespeople. They were measured on sales in the
short-term and they did not see how this conversation contributed t o
that.
Upon reflection I realized that I thought having these conversations
was a viable idea because both of our organizations were involved with
organizational learning, but I forgot t o look closely a t the motivation on
the other side. I learned that everybody around the table has to see value
in what you're trying t o do and that you have t o be really open to the
fact that what's good for the corporation isn't always the same as what's
good for individuals. We didn't do sufficient planning.
So, I'd had another disappointment and another miscalculation on
my part. I was learning a lot. In fact, I guess one way o f looking a t it was
86 Part 2 / The Journey

that I was doing research-by trial-and-error-into what the critical suc-

cess factors for introducing organizational learning were.

The Fourth Project: A Moment o f Truth

Bert: My next challenge arrived on a burning platform: competition.
Now that the industry was deregulated, competition was really heating up
and at the same time our customer satisfaction was declining, and we knew
that meant trouble competitively. There was also pressure from the regula-
tor to improve our service. How were we going to improve customer service
and be more competitive? Executive management was pretty desperate for
ideas and therefore they were willing to try almost anything.
By this time I had service policy responsibility and, of course, service
had always been my driving idea. Now it was a formal charter from the
company president and the business council.
Again, I had to do quite a bit of up-front analysis to come up with a
strategy. I knew that competition was on the horizon. I'd had a lot of
experience in operations in our business offices, and I remember a num-
ber of customers saying that when they were upset with us, they would
love to have another option, but they didn't have a choice. And now I was
faced with the fact that for the first time, customers did have a choice.
As I was reflecting about this challenge, an idea began to dawn on
me. M y sense was that we had to redefine our idea of what "service" was.
We had been a monopoly for a long time and, to me, the ultimate image
of monopoly was the image of the old Fords. The adage that so aptly
described Ford a t the time was, "You can have any color you want, as
long as it's black." I could see the parallel in our own company. We'd been
so used to being a monopoly that we always seemed to be telling our
customers what they should want and how they should want it. We
didn't really have a strong model o f putting the customer's wants and
needs first.
While reflecting on that, I was struck by the fact that we also had a
tremendous history of being superb at service during any kind of crisis-
earthquakes, fires, all those things. I mean, we really outshone ourselves
and people know that. But i t was in regard t o the day-to-day operations
of our world that our customers were dissatisfied and were therefore
saying that they wished they had somebody else. They never said that
when there was a crisis, because in a crisis we always did the right thing
by the customer. That led me t o a very simple conclusion: Doing the right
thing seems to be the unsweK But how could we reawaken this value in
the culture so that it was present all the time? And, could we do i t with-
out "giving away the store?"
 Chapter 4 / The Pragmatist's Path: Bert's Journey a7

Searching for a Strategy to Shift Culture

Bert: Now that I had the basic idea of what I thought we should cre-
ate, I went looking for a way to create it. I looked for a strategy and I made
the link to TQM. One of the defining characteristics of TOM is respect for
people, particularly the people on the front lines. The belief is that the peo-
ple who are actually doing the work are the people that probably have the
answer to how to fix something.
I recalled a story I heard in a "Management for Success" seminar.
Gary Heil, the consultant who led the workshop, was marveling a t how a
certain department store deals with irate customers. He described the
usual process where when the customer wants to return something the
salesperson and the customer both have to wait for the salesperson's
boss to authorize the transaction. Yet, almost inevitably, when the boss
comes t o sign the authorization, he or she never even looks at i t ! He or
she just signs i t ! So, the question Heil posed was, "Why do we do this?"
It really is absurd-and it's wasteful, not t o mention disempowering for
the salesperson. And what does it say to the customer, who's kept wait-
ing? Well, we did the same thing. And I thought, "This is the wrong par-
a d ig m ."
I began to put all that together. I concluded that we really needed to
empower-and I hate to use that word because it's becoming such an
overused word- but we really needed to enable the people who are a t the
front line to do the j o b that's right for the customer.
Then I happened t o read a book that was written by an individual
named Jan Carlzon. It was called The Moment of Truth and it was about
the transformation of a Swedish airline.2
Similar to the telecommunications business, the airline industry has
also gone through deregulation. There were many parallels to what our
industry was going through-the shake-ups, the competition between
the big airlines and the little airlines, and stories about the companies
who subsequently disappeared. Everywhere you look in strategic matters
the telecommunications industry is being compared t o the airline indus-
try, so, it was a good analogy.
I believed that we could build upon Jan Carlzon's approach, similar
t o the way we had built upon the learnings a t Florida Power and Light.
So, for a host of reasons, whether you took it from a strategic point
of view or a TQM point of view or a personal point of view, it all came
together and I said, "We gotta do this. It's our business to lose. We've got
to do this." That's what gave birth t o a program that we also called
"Moment of Truth." The Moment of Truth (MOT) program was about
empowering our employees t o serve customers, to do "the right thing" by
our customers.
88 Part 2 / The Journey

Working with the Culture

Bert: Now that I had a vision and a basic approach, I knew that I had
to have a strategy for implementing this idea in our culture without trig-
gering that "biological rejection" phenomenon, an intervention that's
rejected by the host. I focused on two key things: finding champions and
generating data.
I was able t o find a lot of data that backed up my theory. I showed
how expensive it was t o recover customers that we lose because they're
not satisfied. The market literature concluded that it is twice as hard and
five times as expensive to recover customers once you've lost them. We
also did a lot o f statistics work with our own customer service data that
supported this idea. So, the conclusion was that in this new, competitive
world, it's going to be really important that we develop customer loyalty.
The statistics also showed that when we were really good with cus-
tomers, they appreciated us. And, that translated into repurchasing and
recommending us t o others.

Taking a Different Tack

Bert: We knew that it would take even more data to convince people
of this approach, so we had to find a champion who would support our
going into the field and doing some trials so we could get more data and a
proof of concept. However, when I initially tried to find support for this
Moment of Truth idea there weren't many takers. Of course, I felt disap-
pointed, but I was still sure that it was the right thing to do.
In the meantime things happened; there was a reorganization that
slowed us down, but brought in new players who became our champions.
Now we could start t o make it real. We began by interviewing our front-
line folks, about 240 people. We asked our service reps what barriers pre-
vented them from providing good service-and they told us. They talked
about how they didn't have enough information because we had cut
back on training in order to cut costs. They told us that we had such a
strong emphasis on keeping them on the phones that they didn't have
any time for meetings where they could share ideas or learn new things.
This statement really rang true because we had a measurement we called
"accessibility," which tracks how available reps are to answer the phones
when our customers call. We drove that measurement very hard.
However, there were unintended consequences o f driving that number so
hard. To improve access we tried to reduce the average time that reps
spent with customers which, of course, had a negative impact on cus-
tomers' service.
One of the key things the frontline employees expressed in the inter-
views was that they were often caught in a conundrum. They felt like they
couldn't satisfy customers because doing so was contrary to some policy
we had. For example, we had something called a manager "take-over,''
 Chapter 4 / The Pragmatist's Path: Bert's Journey 89

which means that when a rep had a customer with a problem, he or she
would call in a supervisor t o take over the call. When that happened, the
supervisor usually did something t o placate the customer. Well, there's
no reason in the world why the service rep couldn't do that him- or her-
self, except that, historically, that's not how we did it. It was just like the
story the consultant told in the management seminar I spoke of earlier.
We automatically invoked the hierarchy while we needlessly kept the
customer waiting on the phone.
So we told the reps, "If you know what the right thing to do is, then
you do it." All the vast majority o f service reps needed was some reas-
surance that this is what was expected of them and that i t was OK for
them to do the right thing by customers. The number o f manager take-
overs dropped dramatically as a result and the frontline people felt much
more effective.

One Moment of Truth Leads to Another

Bert: It was a long road from where we were to where we wanted to
be. The frontline employees had been through a lot, with downsizing and
cutbacks on training and, of course, they were veterans of the "another fine
program" syndrome. But because we put the emphasis on telling the truth
and on drawing on the strengths inherent in the frontline employees-and
because MOT wasn't ever driven from the top down like all of our other pro-
grams-we got strong support from the rank and file. One of the most
important things that we did in MOT was feed the data back to the people
who gave it to us. We did it in a verbatim manner so they could see that we
didn't "clean up" the data, that we didn't filter it. As a result, people began
to feel that they could trust, and that was the beginning of real change.
Even the union helped quite a bit. This was one of those rare occasions
where we had both the union and management talking the same talk and
walking the same walk. The employees took heart and they started working
on removing some barriers to service that we had inadvertently created. It
was like what I saw a t Florida Power & Light. Management, the union, and
the front line were all speaking the same language. I finally got there-in
one small, specific case.
We followed our guiding principles; we empowered the front line to
get out o f the box and take the extra step with customers, to shift their
mental models. And in terms of organizational learning, we especially
relied upon Dan, our project manager, who became a very proficient net-
worker. He engaged with the line people about some of the OL tools such
as ladder of inference, creative tension, and whatever else might have
been appropriate in terms o f what they were trying to accomplish.
Despite the not-invented-here (NIH) barrier, the field offices began t o
learn from one another about how to serve customers better. When one
of the local supervisors translated the MOT idea into a very fundamental
approach called "Just Say Yes," it created a big shift in momentum
90 Part 2 / The Journey

because it built a lot of credibility and was a very viable tool for people
to get the idea of what could be and what one could do. That was a mile-
stone. It led to our videotaping service reps who had new ideas and shar-
ing those testimonials across the company. That encouraged new learn-
ings to be transferred.
Again, we were able to change policies, but this time we were also
able to affect culture and personal values. I believe that Moment of Truth
was very successful.

One Journey Ends

Bert: Unfortunately, our company was not doing so well financially.
The huge investment we had made in future technology had drained our
resources and as a consequence, we negotiated a "merger" with another,
larger company. Although it was referred to as a merger, we were actu-
ally bought by the other company-and, o f course, things changed sub-
stantially. The new emphasis was on growth and sales. Because all the
service initiatives now took a back seat to sales, MOT did not continue. I
left the company shortly thereafter.
I moved to a fast-paced technological company in Silicon Valley, but
found that I was not able t o integrate my passion for TQM and learning
into that culture, so, regrettably, I chose t o leave. It was a pragmatic
decision because I assessed that the readiness for learning and continu-
ous improvement wasn't there yet. And for me, that's now becoming
essential.
I've learned a lot about what it takes to do organizational learning
work. I believe that you have to balance your enthusiasm for this work
with pragmatism because it's important t o pay attention t o the financial
aspects of the business. If the underlying fundamentals of the business
are in jeopardy and today's success is the issue, then you have to deal
with those first so that your organization survives and you are still
around t o deal with tomorrow's challenges.
It's important to assess your culture and use what you've learned
about the culture to make incremental progress rather than trying t o
lead people where they don't want t o go. Though you may not always
achieve your loftier goals, above all, leave it better than you found i t and
take comfort in any step forward, no matter how small. If there's a mes-
sage that I want to give, it's do that. But I can't tell you how. There's no
formula. Just keep looking and assessing. Learn about the system in
which you are embedded and how it works. Find out what's sacrosanct
and find a way t o deal with that. Use champions judiciously. Do the sys-
tems diagrams. Develop a working theory. Then try things. Learn from
your mistakes. Regroup. Remember.
 Chapter 4 / The Pragmatist's Path: Bert's Journey 91

Endnotes

1. Daniel Kim, Toward Learning Organizations: Integrating Total

Quality Control and Systems Thinking (Cambridge, MA: MIT
Sloan School of Management, 1330).
2. Jan Carlzon, Moments of Truth (Cambridge, MA: Ballinger
Publishing, 1387).
Chapter 5
Debriefing Bert's Story

What can we learn from Bert's story? How can it help us to learn
more about how to change our organizations? First, let's review
some of the issues that Bert faced in his organization.
The divestiture from AT&T and the rise of competition trig-
gered confusion over identity, core values, and competen-
cies.
Bert perceived that the company tended to be a closed sys-
tem; within the larger system were many other, smaller, sim-
ilarly closed systems. He saw this as having both positive
and negative consequences. The positive consequence was
that the company-and the business units within the com-
pany-protected themselves from quickly adopting bad
ideas. The negative consequence was that there were major
barriers to sharing innovations and learning.The not-invented-
here phenomenon was alive and well.
With divestiture and competition came a need for new ideas,
but also a tendency to reject them. Some ideas could be
sanctioned and brought into the culture, providing they
were proven successes on the outside. TQM was a good
example. But even these ideas had difficulty taking root and
growing. Ideas tended to be championed by someone-an
executive-but then dropped rather abruptly if and when
the champion moved on. A kind of "another fine program"
or "flavor of the month" mentality began to develop; new
ideas began to be viewed with the skeptical attitude of "this
too shall pass.''
The system functioned through the use of legacy processes
that had not been tested in a competitive environment.

93
94 Part 2 / T h e Journey

There was pressure to improve, but that often translated into

assigning blame. In lieu of a better approach this became a
method for solving problems. As a consequence, poor
processes were perpetuated and the culture tended to be
punitive.
When the company embraced TQM, it opened the door for
finding root causes, reasons that were outside the individual
and embedded in processes. But, as Bert observed, TQM was
necessary but not sufficient; it did not have all of the tools
necessary to evaluate a process and make lasting improve-
ments, especially from a systemic point of view. TQM alone
did not have the tools to deal effectively with high levels of
complexity,
Systems thinking held the potential of finding points of
leverage not only for improving processes but also for mov-
ing the organization beyond its crises, but there was a major
barrier. Systems thinking and organizational learning
arrived at a time when the company was recovering from a
public embarrassment over a recent attempt to recover and
create collective meaning, identity, and values: Leadership
Development.

The Organization's Learning System

There is some anecdotal evidence that Bert's organization had a
limited learning system. A strong command-and-control environ-
ment tends to reinforce the values (i.e., governing variables) and
behaviors that instill a Model I learning system. Through Bert's
eyes, we can observe these other cultural realities that con-
strained-and helped create-the organization's learning system.
For example:
Assumptions, such as the view that customer service necessi-
tated increased cost, were generally unquestioned. The
assumption that "time is money" is a case in point.
Another prevailing-and unassailable-assumption was
that "you got the results you measured." However, in some
key instances, the measurements that were in place did not
measure what people thought they were measuring.
Consequently, the results obtained were the opposite of the
results desired. Still, questioning those assumptions did not
come easy.
Problems (such as the high number of trouble reports) were
often solved by finding the individuals who were thought to
be responsible and blaming them-rather than finding the
 Chapter 5 / Debriefing Berts Story 95

root source of the problem, which was often embedded in

methods or processes. Another method for resolving prob-
lems was to shift the burden (a systems archetype) from one
department to another, as in the case of shifting the respon-
sibility for cable utilization from Repair to Engineering.
The organization seemed to create undiscussibles and had
no tools for making them discussible again.
There was some evidence of defensive routines. Bert believed
people could not communicate negative messages so he had
to seek out what he called air cover, someone who could
find out and tell him what people were really thinking.
The fallout from the Leadership Development program
seemed to indicate that there was no infrastructure to support
acquiring a deeper understanding of what happened.
Instead, the organization seemed to learn that organiza-
tional change efforts were potentially dangerous and pro-
grams that involved thinking were to be avoided.

1imited 1earning
The fallout that Leadership Development experience provides
helps us see how limited organizational learning systems work.
Berts companys reaction to their experience with Leadership
Development looks like learning. The companys leadership
found itself swept up in a movement that was actually so disturb-
ing to some employees that they went public with their protests.
As a result, executive management learned to be highly suspicious
of any sort of sweeping, charismatic program that endeavored to
change their thinking. Therefore, by virtue of the use of the very
term thinking, systems thinking became suspect.
Did this reaction constitute organizational learning? Or did it
represent something else? We might interpret these events by sug-
gesting that Berts company created a defensive routine to protect
itself from experiencing further embarrassment or threat. In a pos-
itive sense, the organization protected itself from being swept
away by similar evangelical programs. However, the unintended
consequence of this defense routine seems to be that it prevented
people from identifying and dealing effectively with the deeper,
root cause of the embarrassment or threat. As a result, the organi-
zation may have limited its own learning.

Values as a Source of Vision

Its within this context that Bert sought to begin his organizational
learning work. The desire to create change often comes with an
96 Part 2 / T h e Journey

initial dissatisfaction that transforms into creative energy. Bert's

source of creative energy was rooted in his personal values. Bert
had a central driving idea and core value: customer service. This
driving idea was deeply rooted in his personal value system. It had
stood the test of time; it persisted even when the organizational
values could not or would not support it.

Bert: I wanted to transform the direction the company was going.

The cost cutting, the reduction o f service to the customer, the hurt the
employees were having, the antagonism with the union, all these things
were irritants to me. I wanted us all to grow together and have personal
goals and corporate goals be in alignment. I thought that was the key to
success.
I saw the beginnings of that alignment at Florida Power and Light.
While I didn't talk to them about how they handled such things as down-
sizing and cost cutting, I did look into how they handled customer ser-
vice and I was amazed. They had a very intricate system that allowed for
customers to directly impact their policies. For example, one o f their ear-
lier corporate policy statements did not include the number one concern
that customers had, which was nuclear safety. They put that in only after
they did an investigation into customer concerns. But the point is, they
did it. I saw the customers really influencing company policies and I
thought it was the way things should be done.
There was flow there. I saw that. When the value system and the
personal and corporate objectives fall in line, it's powerful.

Bert's Challenge: The Dichotomy o f Service vs. Cost

Bert also had a central core belief-a working theory: he believed
that good customer service made good business sense. He did not
believe that the adoption of this value would take the business
away from bottom-line results but would instead support greater
profits. Bert also believed that OL was the pathway for bringing
personal and corporate values into alignment.

Bert: I believed that you could have both customer service and eco-
nomic viability at my company. Based on my experience with TQM I also
believed that the people closest to the work have the answers. The chal-
lenge is to value and include them.
Because of the emphasis that OL has on being open t o listening to
people, I thought that OL was the way to create that win-win scenario.
That was why I thought the trouble report project seemed so good,
because I thought we could reduce the dissatisfaction of customers and
save money at the same time. We could also help employees because
they were sick and tired of working crazy hours t o fix problems and then
being "barbecued."
 Chapter 5 / Debriefing Berts Story 97

Berts thinking was directly opposed to the assumptions that

seemed to be driving his company. How had this come to be?
Bert recalled that in the old AT&T culture, the operating phi-
losophy was service at any cost. This philosophy was workable
because costs were directly reimbursable through rate hikes.
Essentially, the customer bore the cost burden of service. Then,
with crisis, came cost cutting. The prevailing assumption was that
cutting back on cost necessitated cutting back on service, since ser-
vice had always represented added cost. Also, a new strategy had
been put in place: Harvest the core to fund new business ventures.
The crisis and this new strategy seemed to create a disintegrating
sense of identity and confusion over core values within the coin-
pany. All of this had consequences for customer service. An over-
correction developed which was self-reinforcing.
A compliant workforce, produced by the traditional com-
mand-and-control culture and reinforced by metrics, con-
formed to the cost-cutting ethos by tending to protect the
company from customers, leading to lowered customer sat-
isfaction;
The primary focus on cost containment was reinforced by a
new focus on measurements and short-term performance. A
form of measurement was needed by the company to help
determine how it was faring in the new competitive envi-
ronment; the measurements provided an important feed-
back loop. Now measurement became the focus and the real
issue was forgotten. The intention was to contain costs, but
numbers became so important that the focus was on them.
As a result, customer service suffered. The impact could be
measured, but the path to correction was unclear.
Good measurements can support the Model I1 governing vari-
able of valid information. Ironically, however, if quantitative mea-
surements become exclusive or all-important, the focus on these
quantitative measures can disable other important capacities. The
consequence in Berts company was that culture began to only
value the things that can be measured; the value placed on human
relationships-once a traditional strength of the company-
began to diminish. Question: How many times do we overcorrect
for one problem and then experience unintended consequences?
We often see values as opposed to business results. Bert
believed that this was a false opposition and he wanted to change
it. But Bert was not operating purely out of humanistic ideals. He
sought proof. And in this way he was very much operating by a
Model I1 governing variable: valid information.
98 Part 2 / The Journey

Berts Initial Strategy and Tactics

Senge notes that most business managers usually begin change
projects with some implicit theory of change in mind. Although
he would be loath to use the word theory,Bert was no excep-
tion. Like any successful executive, he was interested in what fac-
tors would be critical to his continued success. Bert based this
strategy on his experience. He had seen ideas become adopted
when a guru was brought in to sell them. They subsequently
became the flavor of the month.
Bert also believed that personal relationships were a key to
making things successful. Enthused and excited about the poten-
tial of OL himself, he was sure that a spark would be ignited in
others from the company if he could just bring the prophet to the
flock. Therefore, his initial, quick survey of the territory led him to
two tactical decisions. He would:
1. Bring in expertise that is recognized and validated on the
outside.
2. Use personal influence to bring a prospect (a lineVP) to the
table.
Bert believed that he had identified the proven engines of
change in his organization.

Berts Theory of Change

Underlying Berts strategy was a working theory of how thing
worked in his organization. As part of his SWOT assessment, Bert
concluded there were only two reasons why his company would
ever adopt anything new: One reason is because somebody in
authority says so, therefore its blessed and anything thats blessed
from on high gets done. And the other reason is that if they can
see that somebodys doing something different and its giving
them a tremendous result, then everybody wants to know how
they did it. Bert further mused, My initial theory of change was
something like the movie, Field of Dreams. You know, Build it and
they will come.
In The Dance of Change (13 3 3 ) , Senge says that most managers
have an implicit theory of growth and change that he calls the
better mousetrap theory. When managers operate according to
this theory, they tend to believe that if an innovation or change
initiative is successful, interest will spread; i.e., our results will
speak for themselves. Senge says that it generally doesnt work
this way. What happens is:
1. Innovations, in fact, dont spread;
 Chapter 5 / Debriefing Berts Story 99

2. Innovators are often at risk even when they produce results;

and
3. This theory causes people to focus on picking low hanging
fruit, i.e., they constrain their learning efforts, constructing
them such that they can get practical results quickly.
Senge goes on to say that operating according to this implicit
theory of growth is not wrong, but it tends to blind leaders to the
deeper issues that their changes will eventually reveal and to their
inability to deal with these issues. Thus, they fail to develop the
learning capabilities needed to sustain change.2
Essentially, then, Senge holds that this implicit theory of
growth will not be effective. It will not result in diffusion even if
practical business results are achieved quickly. Not only that, but
their success and visibility may put an innovator at risk despite
producing good business-relevant results.

Strategy: Identifying the Wellsprings o f Transformation

In The Dance of Change (1333), Senge et al. also express the view
that one needs to take a biological perspective on change. Senge
posits that there are three fundamental, interdependent, self-rein-
forcing processes that sustain profound change by building upon
each other. Therefore, by definition, any organizational learning
change process must start by creating conditions whereby these
processes are set in motion. What are these reinforcing processes?
Personal results-Senge says that once people experience
living their lives more closely to the way they really want to
live, their passion will emerge and it will be a self-sustaining
source of energy.
Networks of committed people-Galvanized individuals
are necessary but not sufficient; they must also be organized
into networks. The reason is that networks are key to help-
ing innovations diffuse; as agents of diffusion, networks are
superior to hierarchical channels.
Improvement in business results-Finally, besides the per-
sonal commitment and the network organization, OL
change efforts must be linked to business results. It is insuf-
ficient to simply feel good.
Linking organizational learning to business results may be the
most critical source of reinforcement, but it can be problematical.
As we stated earlier, the impact of OL on business results is often
hard to assess, difficult to attribute, and, because learning takes
time, there are often significant delays before any kind of result
100 Part 2 / The Journey

occurs. How long will the organization wait? If you perceive that
the organization cannot wait long, you can begin by eliminating
wasteful practices, Senge suggests, but "even if a pilot group
becomes acknowledged for achieving significant business results,
the larger organization can respond by killing the innovative
P~OC~SS."~
Along with setting in motion the three reinforcing processes,
in The Dance of Change Senge et al. describe four challenges that
often arise at the beginning of an OL effort. These four challenges
are:
No time-There is no time to do this.
Not relevant-This "learning stuff" is not relevant to our
"real" work.
Walk the talk-You're saying all this stuff about change but
your actions don't match up. You behave the same way you
always did.
N o help-We don't have the help we need to get going.4
These challenges must be worked with in order for the change
effort to take root. To what extent does Bert's theory of change and
his experience bear out what Senge says?

Interpreting Bert's Approach

Unfortunately, Bert's first experiment failed so utterly (in his
mind) that he had to seek reassurance that his job was not in jeop-
ardy. Could things have gone differently on that first project
attempt?
Bert had seen the tactic of bringing in a "guru"to sell an idea
work in the past-or had it? Ideas brought in by gurus seemed to
become the "flavor of the month,'' but they did not necessarily
have a lasting impact. Was there a deeper reason why such ideas
did not stick around, outlasting their champions? Could this fit
the pattern Argyris has identified? (See the Introduction.)
Our recognition that good ideas become "fads" and "flavors of
the month" indicates that we may be making some fundamental
errors in the way that we introduce new ideas into organizations.
In particular, if we try to force-fit learning into that pattern we may
kill it before it has a chance to take root. Even more to the point,
learning is in direct conflict with this approach. The implication is
that leaders must make the shift at the very beginning, that their
very first action must show that they are opening up a space for
learning. It is not easy to come to terms with this because fear will
arise: the fear of being clumsy as well as the fear of rejection, of
 Chapter 5 / Debriefing Berts Story 101

appearing to be too different. Yet, there must be a moment when

the leader makes a definite decision to follow a differen.tpath-a
learning path-and to do so with both subtlety and humility.
The need for subtlety and humility seems to show up in the
way people in Berts organization reacted to the suggestion that
they begin the meeting by talking about the undiscussables.
Seen within the context of Argyriss work, this may have been
important, but it was also premature. It felt like an attack because
neither the values nor the skills for moving from Model I to Model
I1 were in place. Nor had people agreed to begin this learning. The
ability to abandon the need to save face or to question deep
assumptions had not been cultivated and therefore the suggestion
(by the people from MIT OLC) would certainly be challenged.
Another factor contributing to the collapse of Berts first
project attempt was that Bert did not engage any other sources of
support (such as those identified by Senge et al.) that might have
helped his initial idea catch fire. As a consequence, there was no
pull. No one was able to see how they would achieve personal
results, nor was it clear how business results would be achieved-
and, while Bert tapped into his personal network, there was no
strong network of people who were inherently committed to a
learning approach.

Learning from the First Project Attempt

Bert didnt have the benefit of Senges thinking when he encoun-
tered the early challenges described in The Dance of Change in his
first project attempt. Thus, he responded to them in his own way.
Essentially, he reacted to them rather than anticipated them, and
the solutions he devised tended to be defensive rather than gener-
ative. For example, the negative reaction he experienced from the
line VP reinforced his determination to connect OL to business
results so that OL would not be seen as irrelevant. Similarly, when
the line people pushed back on the issue of time, this may have
triggered him to overcompensate by trying to do too much himself.
In terms of finding help, Bert had thought that he could just
rely on personal relationships as an engine for change, but that
backfired. While he might have engaged in a process of inquiry to
understand why and to perhaps get at some deeper assumptions,
he instead leapt to make a correction in his strategy. He deter-
mined that if he couldnt rely on his network of relationships to
support his getting a learning effort going, then he would go
underground, focus inward, and build a small learning team. Bert
did seek help in the form of air cover. He asked his boss to tell
him when and if he overstepped his bounds, but he did not seek
102 Part 2 / The Journey

help with the larger question, how do I initiate learning in a cul-

ture that is highly suspicious of unfamiliar ideas?
Bert also determined that he had to be careful about how he
introduced OL into the organization, because it was foreign to the
culture and that would most likely result in its rejection. So one of
his first steps was to eliminate all the OL jargon in order to make
OL look more like the existing culture.

Learning and Limitations

After his first project didnt get off the ground, Bert did a SWOT
analysis that told him there were limits to what he could attempt.
Bert was not at the top of the hierarchy and he had determined
that support from the top was minimal at best. Therefore, it would
not have been politically prudent for him to attempt too much,
such as addressing the organizational learning system directly.
Rather, he tried a more indirect strategy: he attempted to use the
culture to change the culture. In other words, by acknowledging
the limits of the cultures learning system, he could find ways to
leverage that learning system in order to get the results that he saw
were in the long-term interests of the firm. In essence, Bert found
a work-around.
In many respects, this was an ingenious strategy, one that dealt
exceedingly well with Berts current reality. However, the strategy
created its own conundrums and paradoxes. In trying to work
around the limitations of the organizations embedded learning
system, Bert was trying to do the learning for the organization.
This is very apparent in the simulation project.

Simulation: The Failure o f Diffusion

Berts trouble report pilot project was a success in the businesss
terms. He successfully investigated and challenged some loosely
held assumptions, an excellent example of double-loop learning.
Yet he was convinced that the rest of the organization wasnt ready
to learn in this way. After the initial success he went on to develop
a strategy for diffusing the learning. However, he ran into road-
blocks. He sensed that people in the organization were not invest-
ed in learning about how to get the results themselves, so he
essentially tried to devise a strategy whereby the simulation (or
black box) could do the learning for them. This dilemma sensi-
tizes us to the ways in which limited learning systems can impede
getting results. It also shows us how, as leaders, we can leap into
making heroic attempts rather than taking the risk of trying to
engage with others in collaborative problem-solving.
 Chapter 5 / Debriefing Berts Story 103

Dan Mlakar added, We took Berts approach which was

Prove it and they will come. But I do think that you have to gen-
erate personal results and business results. I still believe thats true.
How you get there is a real big decision.
In Dans view, you cannot begin an OL effort as a lone
ranger; you cant single-handedly lead a learning effort. Nor can
you use OL to create commitment and creativity in people if it
isnt already there. The better approach is to find people who are
inherently committed to a learning approach and then begin to
activate the development of a mutually supportive network:

Dan: The bottom line is that you need proactive, creative people who
are both close to the resources and close to the results. They need to bal-
ance practice (with learning tools and techniques) and performance. This
is a prerequisite. Creativity and commitment must already be in the orga-
nization in the right place. You cant create this commitment with OL; it
has to be inherent in the make-up of people. Youve got to find the peo-
ple, the line leaders who have it already.
The key learning for me was that you cant circumvent the learning.
You dont even have to build a microworld to start the learning. Just start
with some causal loops on policy exploration, decision making, under-
standing assumptions, side effects, etc. You need to explore mental mod-
els in a casual, friendly way.
I am convinced that if Bert had gotten his potential early adopters
(district managers) in a hostage situation with some systems thinking
experts, things might have been different. These systems thinking experts
were just magical in their ability to take a complex situation and scope
it out using causal loop diagrams. If wed done that some of our guys
may have begun to see the value in learning and thinking this way. The
reason I think this is because the Beer Game is such a powerful tool. Its
a real eye-opener. Its a concrete experience in a risk-free environment.
And it works. Everybody learns from the Beer Game.
But people have to be committed to getting a sense of policy and
strategy; they have t o be committed to double-loop learning. There is
some important foundation stuff that has to be there. People have to be
willing to engage with mental models and deal with the ladder o f infer-
ence because those are the fundamental tools to explore why you do
what you do. That foundation is required (but it wasnt there).

Dans suggested strategy takes us in the other direction. Rather

than doing the learning for the organization by creating a black
box (as Bert attempted to do), Dan suggests that key people in the
organization can be enticed into learning if they can personally
experience its benefits. In other words, if they begin to experience
personal results, learning might become valued. This is similar to
a strategy that Senge et al. describe in The Dunce of Change. When
104 Part 2 / T h e Journey

facing a diffusion challenge they suggest bringing together a group

of key, yet diverse people to engage in a skillful, facilitated discus-
sion about the diffusion challenge. This is a suggestion that could
have enabled Bert to share the responsibility for diffusion rather
than shouldering it all himself. But did Bert and others have the
capacity to engage in such generative conversations? As Argyris has
pointed out, managers often have communication difficulties in
these areas. The inability to communicate well up and down a
hierarchy and across divisions is a major threat to successful
change efforts.5
Another aspect of Berts theory was the conviction that you
had to use the culture to change the culture. Bert used this idea
to remind himself not to challenge the organizations culture
directly. The area of culture and its relationship to organizational
change and learning needs much more attention than we are able
to provide here, so we only pose a question: Would it have been
helpful to Berts change effort if he had been able to do a more
extensive cultural assessment?

The Third Project: A Missed Opportunity

Berts third project, the attempt to create a mutually rewarding
relationship with AT&T, was defeated early on by not meeting the
initial challenges of relevancy and time. The AT&Tparticipants did
not see the relevancy to their performance, which was measured in
the short-term, and therefore did not believe they could devote
the time to the conversations.
Learning efforts all require a certain amount of what we call
ground zero preparation work. We need to spend the time to
prepare the ground for learning. In particular, we need to balance
our advocacy with inquiry, asking the questions that need to be
asked before we begin, questions like: What do we want to create?
Who should be involved? How can we all benefit? The reinforcing
growth processes that will bolster the development and sustain-
ability of the project also need to be uncovered and nurtured. In
this case the reinforcing growth processes identified by Senge et
a1.-personal results, networks of committed people, and business
results-did not appear to be in evidence. The challenges to initi-
ating that Senge has also identified, relevance, time, etc., also need
to be anticipated. Due to a lack of understanding and the rush to
do the project (because thats what businesspeople are good at),
Bert did not do all of the ground zero work to ensure that the
project had a chance of succeeding.
The collapse of this collaboration shows how Model I learn-
ing systems can prevent us from getting the results we truly want.
Issues of relevancy and time can sometimes provide handy
 Chapter 5 / Debriefing Berts Story 105

excuses for not working the tough issues. We often let an ineffi-
cient, painful, or even absurd situation continue rather than to
challenge the conditions that keep it in place. The limited learn-
ing system undermines commitment and, of course, the lack of
commitment reinforces the limited learning system.

The Fourth Project: Moment of Truth

The Moment of Truth (MOT) project was Berts most successful
project, primarily because crisis created an opening for a new
approach. Management was out of ideas and something new had
to be tried. Crisis had weakened the existing learning system.
MOT also had the following:
@ A well-thought-out theory of change that kept evolving
based on feedback.
At least two of Senges reinforcing growth processes were in
play from the beginning. Both business results and personal
results seemed possible on multiple levels. These results
were beginning to be experienced by some executive and
line managers, the front line, and the union.
The project was able to find and connect the people who
had a sense of commitment to the project. Therefore it could
bypass the early challenges of initiating: no time and not rel-
evant.
They found champions who truly did walk the talk. In par-
ticular, the VP-level champion was willing to reveal that he
did not know all the answers.
@There was sufficient help in the beginning stages and
throughout.
While the idea for the program began with Bert, the program
itself took on a very grassroots flavor rather than be a pro-
gram that was rolled out from the top down. The VP-level
champion was obviously and openly committed to provid-
ing freedom of choice. Without explicitly saying so, he advo-
cated the Model I1 values and behaviors.
As a result of the proven interest in obtaining and sharing
valid information and allowing freedom of choice, a net-
work of committed people, including the union, evolved. In
a sense, MOT validated the power of Model I1 and revealed
how readily it could be set in motion-providing the condi-
tions were right and the proper values were in place.
These were strong initial conditions. Senge et al. have also
identified challenges that can hinder a learning effort in the later
stages. These challenges didnt seem to pose significant threats
106 Part 2 / The Journey

because fear was acknowledged and discussed openly. Also,

because of the deliberate openness and choice-a hallmark of the
Model I1 theory-in-use-there were no "true believers" in the
threatening sense. People were free to do what they thought best.
However, Senge et a10 challenge of assessment still proved some-
what problematical. Evidence of results was looked for, and mea-
sures themselves were looked at. Although the program made
sense in every other way, it was hard to prove that empowering
front line employees to do what's best for the customer was the
most effective business strategy from a financial perspective.
Although the MOT program was not in place that long (per-
haps just over a year), it began to have an effect on the organiza-
tion in which it began. In effect, the program began to address the
challenge of governance by implicitly and explicitly questioning
the long-embedded tendency to invoke hierarchy. More decisions
were made at the local level and at the front line level. Local orga-
nizations had the latitude of choice which was antithetical to the
traditional approach of one-size-fits-all. There were also several
successful transfer-of-learning efforts. Ultimately, however, MOT
was not sustained. It met up with the challenge of strategy and
purpose when the buy-out/merger occurred. It did not survive the
merger.

Learning and Leadership

Without ever naming it as such, Bert was sensitive to the aspects of
himself and his culture that reflected Model I. Of course, this dis-
sonance did not show up as a theoretical construct. Instead, it
came to him as a feeling that something wasn't quite right and
that potential was being lost.

Bert: Most of the people who worked for me in the early days would
say I was a Theory X manager.6 But then different things started hap-
pening that bothered me. For example, I perceived that the company was
actually being run as if it were made up of fiefdoms. Each of the fief-
doms was sort of a closed club. Everybody was running their fiefdom;
they followed the party line and they were very much control freaks.
Although I had elements of that in my personality as well, it wasn't really
satisfying and I didn't think it was in the best interests of the company. But
I wasn't sure what the alternative was.

A logical consequence of Model I theory-in-use in the business

environment is that fiefdoms form. Individual managers are con-
cerned with controlling and winning; there are battles over turf
and people advocate their points of view. These behaviors can
 Chapter 5 / Debriefing Bert's Story 107

continuously bolster each other, creating a self-reinforcing system.

In this atmosphere, concern for the collective well-being is mini-
mized. In Bert's view this was characterized as typical command-
and-control or "Theory X behavior." Why did Bert begin to turn
away from this style of management?

Bert: I really started to feel differently when I went to the executive

program at MIT in '91. I was in a class of 47 people from 22 countries
and we had 3 months o f intensive living together. We were all assigned
"buddies" and my buddy happened t o be from Japan. I realized that he
had a whole different perspective on the world. His basic issue was
whether or not things were in harmony. He used the word every day. For
example, he would draw a Venn diagram. The three circles represented
family life, personal life, the corporation. He would show them overlap-
ping and talk about their being in harmony. That just stayed in my mind.
So when I got back to work I wanted to try t o change some things.
And since I was having good results, I was given a certain amount of lee-
way. But it was a hard transition. It was much easier to be successful by
being the way everybody else seemed to be. But it just didn't feel good
anymore.

Bert's shift began when he first sensed discomfort, but his real
change effort began when he had a close and prolonged encounter
with someone who had a different perspective. He began to sense
that his present lens was not the only way of looking at the busi-
ness world and he began to consider an alternative. As a conse-
quence, his commitment to bringing personal and corporate values
into alignment grew stronger. Yet, being pragmatically oriented,
Bert chose to act on that conviction only when he thought there
was a viable approach (such as OL) that could produce positive
business results and when he thought he had sufficient clout and
credibility to begin.
In moving forward, however, Bert encountered one of the
most difficult challenges facing change leaders: How do you
become the type of leader who is embodying the change you wish
to bring about? This is the challenge Senge calls "walking the
talk," but that term may camouflage its inherent difficulty. When
Bert began his own learning group he seemed to be trying to shift
his own leadership style, as Dan Mlakar observed:

Dan: Bert was always a Theory X manager looking to be Theory Y.

That was the conclusion a number of people in our group reached. I think
he was always caught in the middle, asking himself the question: How
can you act like Theory Y when you really are kind o f Theory X? I think
that was his big challenge.
108 Part 2 / T h e Journey

Our mental models constrain the way that we can think and
act. For example, we tend to think in terms of dichotomies, so
when we think of Theory X or Theory Y management styles they
feel like binary categories. So, then, how do we change from one
style to the other? We try to act differently, almost as if we could
just flip a switch. Then, because we can't consistently stay in our
newly adopted style, we tend to oscillate between seemingly binary
choices, often confusing others and ourselves.
However, if we think within the context of Model I and Model
I1 we may start to see that the transition is not just a matter of
jumping categories; it is a learning process. We no longer expect to
make this transition without the benefit of a supportive learning
process that would enable us to inquire into and learn more
deeply about our leadership styles. We need to be reminded that
the journey from Model I to Model I1 is a collaborative learning
process, not a matter of throwing a switch or reprogramming our-
selves in isolation from others. Like many leaders, Bert expected
himself to be able to negotiate that shift in isolation without feed-
back, support, or process.

Learning from Bert's Story

Bert's story is about taking a relatively pragmatic path through the
uncertain territory of a limited learning system. If Bert's story tells
us anything, it focuses us on the importance of values. Values can
be galvanizing and they can sustain us.
Bert's story also illustrates the choice that senior managers
who are embedded in a Model I learning system (and who are not
top management) must make. They must ask themselves a series
of questions: First and foremost, do they attempt an organiza-
tional learning effort? Are there sufficient conditions to support
their doing so? Are there significant signs-as there were in Bert's
organization-that deviating from the Model I system is a risky
venture? If there are more apparent risks and threats than oppor-
tunities or sources of support, is it worth the risk? We have to go
even deeper and ask ourselves: Are the risks real or are they only
apparent? If we don't go to a deeper level of inquiry and if we
don't check our conclusions with others, we may be colluding in
limiting our own sense of aspiration. We reduce the tension by
lowering our vision.
If these potential learning leaders say "yes" to learning, then
there are more questions. Are they drawn to this challenge for the
good of the organization or because they have a need to be
heroes? Do they attempt to bring about learning within the con-
straints of the existing learning system-or do they attempt to
 Chapter 5 / Debriefing Berts Story 109

stretchtoward Model 11, invoking the proverbial creative tension?

If they choose to attempt learning within the existing (limited)
system, how do they avoid reverting to the old ways of limited and
accidental learning? Conversely, if they attempt to stretch the orga-
nization toward a Model I1 learning system, how do they create
conditions so that they have sufficient support?
Because these questions werent as yet articulated, Bert was
caught in a gap. In his moments of unalloyed pragmatism, Bert
accepted the Model I learning system as a given and adjusted his
tactics accordingly. Yet, Bert wanted the Model I1 governing values
to be in place; he wanted the organization to operate on the basis
of valid information and informed choice. However, he believed
that if he deviated too much from the cultural norm he would
place himself at too great a risk.
Not surprisingly, the limits in the organizational learning sys-
tem were mirrored in Berts own capacity to learn. He needed to
have a clearly articulated theory of change that was also open to
question. The assumptions underlying that theory of change
needed to be open to question as well. However, overall, Berts
personal learning tended to be single-loop (in other words, the
detection of error and correcting without questioning deeper
assumptions) even as he was attempting to lead an OL effort.
Throughout the four projects, Bert was continuously acting, eval-
uating, and then trying something different. To the extent that his
next tactic got him the results he wanted, he was continuously
learning because he was able to detect an error and correct it by
designing a more effective action. But Bert did not explicitly
engage with double-loop learning. Nor did he seek support for
this deeper learning process.
This is not to single Bert out for criticism. Studies show that
when managers confront open-ended situations, they have a very
widespread tendency to use single-loop learning, as Ralph D.
Stacey points out in Managing the Unknowable: Strategic Boundaries
Between Order and Chaos in Organizations (1332). Stacey goes on to
say that managers seldom activate the second loop of reflection.
Yet, When consequences are unknowable and cause-and-effect
links extremely unclear, it becomes vital to inquire into the man-
ner in which one is perceiving what is going on. Many problems
that managers have with strategic thinking may be traced to their
use of an inappropriate kind of learning. Ironically, it is when
we most need to do reflection that we are most likely to shy away
from it.
By relying on single-loop learning, Bert may have circum-
scribed his potential for success. The constraints Bert tended to put
on his own learning mirrored the external constraints that Bert
110 Part 2 / The Journey

experienced. Theres an insight here that could help other leaders

of learning. If leaders want their organizations to truly transform,
they must begin with themselves, because, as Argyris and Senge both
say, individual transformation and organizational transformation
go hand-in-hand. As leaders engage in the process of collabora-
tively learning Model I1 values (i.e., governing variables) and
skills, this learning will begin to create the new system.
Berts story shines a light on the modest heroism that learning
leaders must demonstrate when they are working within the con-
fines of Model I, particularly when they are not at the very top of
a hierarchical organization. The resources of such leaders are lim-
ited and their options are often constrained. They have to work
with what is at hand. There are real risks involved with taking on
leading change. The risk has to be worth it. In the middle of the
night, when you cant sleep because youre worried that you have
it all wrong, you have to feel that in your heart-of-hearts, its worth
the risk.
While Berts story raises some key questions about leading
change, Ivas story raises others. We turn to that next.

Endnotes

1. For more on systems archetypes, please see Peter Senge, The

Fifth Discipline: The Art and Practice of the Learning Organization
(New York: Doubleday, 1330), pp. 378-330.
2. Peter Senge et al., Dance of Change: The Challenges of Sustaining
Momentum in Learning Organizations (New York: Doubleday,
1333), p. 42.
3. Senge et al., 1333, op. cit., p. 53.
4. For more on The Challenges of Initiating, please see Senge
et al., 1333, op. cit., pp. 67-237.
5. Chris Argyris and Donald Schon, Organizational Learning: A
Theory of Action Perspective (Reading, MA: Addison-Wesley,
1378), pp. 246-243.
6 . For more on Theory X, please see Leadership and Motivation,
Essays of Douglas McGregor, edited by Warren G. Bennis and
Edgar H. Schein with the collaboration of Caroline McGregor
(Cambridge, MA: MIT Press, 1366), pp. 5-21.
7. Ralph Stacey, Managing the Unknowable: Strategic Boundaries
Between Order and Chaos in Organizations (San Francisco:
Jossey-Bass, 1332).
Chapter 6
A Visionary Voyage:
Iva's Lea rn ing J o u rney
h a : Peter Senge's The f i f t h Discipline has had a profound impact on
my thinking about business management and organizational learning.
My experience as a business leader has confirmed to me the importance
of the principles set forth in this book. In particular, I have learned
through practice that to successfully grow a business, one must take into
account the interests of multiple stakeholders, and not just the actual
shareholders and investors. Customers, suppliers, and employees are all
crucial participants in any business operation, and their needs and capa-
bilities for contribution must be accounted for in the business plan.

Deep Aspiration Becomes a Driving Idea

Iva: Although I very much consider myself an American, I was actually
born in Europe-in Yugoslavia. From the age of 10 I had a vision: I wanted
to leave my homeland because I wanted freedom. I was exposed to the fear
and the suppression of people's voices that was so intrinsic to the
Communist agenda, and I knew that I did not want to stay in Yugoslavia.'
For some very deep reasons, then, freedom is very important to me.
Everything that I have done in my life and career-particularly my
attempts t o change the corporate environment-came from the desire to
create greater freedom for myself and for others. However, over time I
have learned that freedom is a far more complex concept than I had orig-
inally thought. I wanted freedom so much, yet that does not mean that
I knew how to be free.
As president of Philips Display Components (PDC), I initiated work on
organizational learning. The goal was to create a workplace that would
respect the needs of all stakeholders. My hope was that we could put in
place an infrastructure that would support learning and, by so doing, we

111
112 Part 2 / The Journey

could create a workplace that was both kinder to people and more pro-
ductive all around. These efforts yielded small successes in some areas,
and unexpected consequences in others.
Organizational learning was actually the third strategy that I put in
place in the hopes o f sustaining the company in the face o f enormous
competitive pressures. The story begins with describing those other
strategies in order to set the context. While the other strategies do not
deal with OL perse, they describe the challenges we were facing and the
events that finally turned my thinking toward OL as an optimal strategy.
This story also includes the voice of Phil Fazio, my former Chief Financial
Officer. I asked Phil to comment on my story because, as a CFO, I believe
he will offer a pragmatic and balanced perspective on what happened. I
offer this narrative as a "learning story" from which we might draw some
lessons for leading change efforts in the future.

Background
Iva: I joined PDC in the spring of 1983 as VP of Engineering. PDC was
a maker of color picture tubes for use in television sets, which was a very
competitive, global market. At that time PDC had about 2,500 employees
and $250 million in sales. There were two factories, one in upstate New York
where PDC headquarters was also located, and another in rural Ohio.
PDC had been acquired from Sylvania by PDC's new parent company,
North American Philips, in 1981. In turn, North American Philips was 52
percent owned by Philips in the Netherlands with its headquarters and
management located in Europe. At the time, PDC was not fully integrated
into the global Philips business.
I was excited about the opportunity because I had a strong convic-
tion that Philips had the financial and human resources necessary t o get
the consumer electronics industry, in particular the components industry
in the US., on its feet so that we could be successful global competitors.

First Strategy: Integrate fresh Ideas, New Technology

Iva: As Engineering VP, I was responsible for product and process
design, product and process implementation into manufacturing, and con-
trol of manufacturing processes.
My boss and I were keenly aware, however, that PDC had been
neglected; the previous owner had not made capital investments in quite
some time. The factory was old and had not been upgraded. The equipment
was old, the picture tubes were manufactured using different, less efficient
kinds of processes than those used in other Philips factories, and production
yields were lower. Costs would have to be cut. Capital investments would
have to be made.
 Chapter 6 / lva's Learning Journey 113

We also made the assessment that certain critical technical compe-

tencies were lacking.
Therefore, part of our initial strategy was to bring in competence
from the outside. I began hiring people from the competition and set
about trying t o improve our processes.

First Learnings
Iva: Because of my exposure to the Japanese methods while working at
my previous company, Zenith, I felt very strongly that TQM would be the
path toward achieving some of our objectives. However, there was a lot of
resistance to change. The not-invented-here syndrome was alive and well.
I remember sensing the climate a t PDC at that time. The company
had been acquired by its parent company t w o years earlier and it was
still feeling the effects. The former Sylvania employees saw the Philips
people as "conquerors." After they experienced the first sense o f relief
that comes from knowing that the doors are not going close, they began
to realize that the new owners were bringing change and new culture.
All o f this was not welcomed.
As I began to try to integrate new ideas, I also began t o realize that
we really did not have a full appreciation o f what needed to be done t o
integrate people, processes, and the machines with which we produce
the product. Our focus was totally on technology-which is not surpris-
ing since both my boss and I were technologists.
In 1984, after I had been in my job for about a year, the parent com-
pany's previously taken decision t o move most of the manufacturing t o
Ohio was implemented and 1,000 people lost their jobs in the town
where the factory was located.

Seeing Red
Iva: In 1986, I became president of PDC. When I took over as president
I had my work cut out for me. I quickly realized that the projected budget
for the company was not achievable. Although we had tried so hard to turn
the company around, we still had red ink flowing. We were losing both
money and market share.
I believed that the state of the business was such that we had only
two choices: either radically restructure the business or close it. I wanted
to attempt a radical restructuring. To achieve a turnaround the PDC
management team and I needed to marshal all the resources and knowl-
edge that we could. With the approval and support of my European man-
agement, I evolved a plan that included bringing both human and finan-
cial capital to the enterprise, implementing traditional restructuring, and
introducing the principles of total quality management (TQM) as a man-
agement philosophy. But the first step involved downsizing.
114 Part 2 / The Journey

The Turn-around Strategy

Initial Tactics: Downsizing and Moving
Iva: I offered upper-level management a stopgap strategy to get us out
of our immediate problem. The first step in the turnaround was the elimi-
nation of the New York factory-which after the first consolidation in 1984
still employed about 400 people-and to consolidate the remainder of man-
ufacturing into our one larger factory in Ohio. I also moved the headquar-
ters in New York closer to the Ohio plant.
I recognized that this was to be another downsizing for the company,
and that there had been a lot o f downsizing before I became president. I
was able to justify it t o myself and to the company and its people, how-
ever. l believed that, as president, my first and foremost task was to stop
the flow of red ink. After completing the downsizing, my task would be
to rebuild by aggressively integrating the parent company's and PDC's
technology, while also improving product quality and customer service so
that we could be competitive again.
I believe that teamwork and management sensitive t o people's needs
helped smooth the factory closing and the HQ move. I believe that we
downsized in as humane a way as possible. And, when we moved the
headquarters, everyone was given the option to move. We explained the
reasons for the move; we gave people adequate notice: we helped them
sell their current homes and get new mortgages; we offered financial
assistance for moving and other expenses; and, we had career counsel-
ing for spouses. For those who didn't want t o move, we offered out-
placement services. Approximately 50 percent o f the employees moved
with the company.
There's a difference between reducing the number o f people in a
facility and closing the doors and leaving town. I was the one who closed
that facility. I still believe that it had to be done and I still believe that
people can learn a great deal about themselves from adversity, so some-
times things like this can actually serve people's growth and learning.
But it is not easy stuff and I did not want t o ever have t o downsize again.

Meeting Resistance to the Integration Strategy

Iva: During this time I continued and expanded my initial strategy of
infusing fresh ideas, now bringing in technological know-how from the par-
ent company in Europe into PDC.
Again, there was resistance. I perceived that there was mistrust on
both sides. Those who were responsible for technology development in
the European headquarters were not ready and willing t o transfer that
technology because they were not sure that we were competent to
receive it. They were also very concerned that the technology would leak
 Chapter 6 / Iva's Learning Journey 115

to the competition, especially the Japanese, whom they greatly feared.

So a dance, a kind of tug-of-war, began.
There were also divisions within the company that hampered overall
productivity. I discovered that the engineering department did not feel
responsible for either the costs nor any losses incurred in manufacturing
its designs. In other words, they were never asked t o take responsibility
beyond design.

Creating Culture as a Tactic

h a : As we were working on the many issues that beset us, I also
became aware of the role that corporate culture was playing-or not play-
ing-in our effort to recreate the company.
The company I previously worked for had what I call a "street-fight-
ing culture." It was a free-for-all. If you had the opportunity t o grab
something, you did, because that was the only way you could make
something happen. I was comfortable in that kind o f a culture, and
thrived in it.
By contrast, as I assessed the organizational climate, I saw that PDC
was acting like a very hierarchical, very traditional command-and-con-
trol organization. In general, people did not speak out or act until they
were told to. In addition, the management a t PDC had been isolated from
the employees and there was little trust. In the midst of factory closings
and layoffs no one would tell management anything important. The
employees were silent, waiting for direction. Morale was low.
It also seemed t o me that there were a number o f cultures now oper-
ating within PDC after Philips acquired the company. There was the
Philips culture and there was the culture o f the acquired company, which
seemed very typical of company cultures in a regulated industry. (General
Telephone owned Sylvania before Philips acquired it.) Although some
were keenly aware o f the competitive forces arising out of globalization,
particularly Japanese competition, there was a lack of knowledge of how
to deal with that effectively. There were also some cultural issues intro-
duced by some of the new senior managers, including myself, who came
from "superior" companies such as Zenith or RCA. Decisions and actions
taken by these newer members, though appropriate and necessary, tended
not to sit well with members of the old culture. And, of course, there
were the differences embedded in the various subcultures such as man-
ufacturing, engineering, and so forth.
So when the PDC management decided t o move the company head-
quarters to a location closer to the factory, we spent much time thinking
about the kind of culture we wanted to develop in the new location. In
our view, this sort of thinking ahead was essential not only for saving the
company but also for growing it. After much thought, 25 people (out of
350 a t HQ) developed a company credo.
116 Part 2 /The Journey

PDC's Credo
We, the members of Philips Display Company, are dedicated to:
Recognizing that the customer must always be satisfied.
Striving for excellence by producing quality products and services.
Communicating company strategy to each level of the organization, so
individuals can make knowledgeable decisions to support those strate-
gies.
Driving decision making down to the organizational level that has the
most information on the subject.
Encouraging teamwork throughout the organization.
Being enthusiastic leaders acknowledging that each decision is made to
further our common goals and communicating this enthusiasm to every-
body.
Being attentive to listeners to enhance two-way communications.
Recognizing that we, the employees, are the foundation of our business.
That each person contributes in accordance with his/her skills to the suc-
cess of the business and that each contribution is important.
Nurturing an environment that encourages creativity, experimentation,
and risk taking, understanding that mistakes and failures provide oppor-
tunities for learning.
Celebrating the success of an individual or group; recognizing achieve-
ment; having fun while celebrating.
Respecting all workers by treating each individual as you would want to
be treated.
Fostering the growth of employees through training and support, to pro-
vide maximum opportunity for contribution and achievement.
Integrating these goals to achieve satisfactory results.

This credo was developed many years before the parent com-
pany in Europe started a corporate initiative on corporate values.
It grew out of our work in TQM and expressed my expanding
vision, which was to provide the opportunity for more people in
the company to create what they truly desired. The credo reveals
what these people desired to create.
We made the credo a part of our orientation for new hires and
we were successful in creating a culture at the headquarters that
was very much aligned with the credo. The credo was also distrib-
uted throughout PDC, but that was not sufficient to result in its
being adopted by everyone in the company. Since the people in
the factory did not participate in the development of the credo
they did not feel ownership-and that would play a role in what
was to happen later.
 Chapter 6 / Iva's Learning Journey 117

Culture and Conflicts in Leadership Style

Iva: As I continued in my new job as president, I found myself both
pushing people for compliance to my ideas and vision and working
toward getting genuine cooperation. Most of the time I felt as if I were
on a teeter-totter. This was not a good feeling. I also believed that for us
to be more competitive, we needed t o develop from that hierarchical,
command-and-control organization into a high-performance, participa-
tory organization. But the pathway between here and there was
unknown.
Yet, I believed that we were making progress-albeit very slowly. I
realized that we had to create a communication link between engineer-
ing and the factory. This required some retraining o f staff and opening up
the communication channels between the engineers and the factory. This
effort took years.
As I dealt with these issues I began t o become very interested in the
field of organizational development. I began t o seek out more informa-
tion, coaching, and training in organizational development. At the begin-
ning o f my career, I had not given much thought t o integrating what I
call "social technology" into the process. Given my background as a tech-
nologist, it's probably no surprise that I didn't have a good understand-
ing o f how t o put people, machines, and technology together. Now I
wanted to develop my own abilities in this area.

A New Tactic: Focus on Developing the Management Team

h a : I reasoned that if I built a strong management team-a team that
really acted like a team-then management would actually be living and
modeling the behavior we wanted and that behavior would trickle down
through the ranks. I had a very exact definition of "team." In a team, every-
one in the group is supportive and sensitive to all its members. That creates
an environment where it's OK to make-and learn from-mistakes. Having
traveled to Japan many times I had picked up some insights about the
Japanese view of management. I saw that if you only reward and encour-
age individual achievement, you'll get contributions only from the most
individualistic and self-confident members of your staff. Since those people
only account for a small portion of your staff you end up limiting overall
company performance. Most of us in management were trained to develop
individual skills, but we had little training in how to make better teams.
It was equally important for us to accept the fact that, as an orga-
nization, we had not effectively used the ingenuity of all of our people.
We had to learn t o break the tradition of, "You are told what to do, and
that's all you do" or "Check your brains a t the gate." This sounds like a
simple and clear thing t o change, but it's fraught with many difficulties
that come from past history, individual expectations, fears of being dis-
covered for not knowing something, lack of trust, etc.
118 Part 2 / The Journey

We worked closely with a consultant recommended by the people

from the Center for Creative Leadership who coached us and helped us
with team-building, in particular within the management team that led
PDC. In the years to come the management team, including myself, made
a lot of progress toward building a better understanding of what team-
work was all about. At the same time I was surprised a t how difficult this
transition would be and how long it would take.

A Failed Tactic: Developing a Better Relationship with the Union

Iva: The union leadership and management had some confrontations
during this period, but we did make some progress and, ultimately, I knew
that we needed to evolve the relationship beyond the current confronta-
tional one. To that end we entered into a collaboration with an industry
relations and human research center a t Cornell University. The goal of this
collaboration was to merge our TQM effort with a parallel attempt to cre-
ate a sense of partnership between management and the union. The man-
agement team and I had great expectations for this collaboration: we
believed that we would see real business improvements.
The partnership didn't materialize as we hoped for reasons that, in
retrospect, I can see were very typical of the way we went about things.
For example, we created a steering committee comprised o f selected
people from the factory and headquarters to work on a project that
would create multifunctional jobs with the objective to reduce the num-
ber of classifications then enacted by our union contract. They developed
a comprehensive plan for how we were going t o implement it and every-
thing looked fantastic. Then, when we rolled it out to a pilot group, it
blew up in our face. It was wholeheartedly rejected.
In addition, during the same period in which we were making
progress with the union leadership, that leadership was voted out of
office. This happened because o f the perception among part of the
unionized workforce that the union leadership was "in bed" with man-
agement. A small group o f unionized workers went on a campaign t o
change the leaders, and they were successful in making it happen. As a
result, we had to start the process o f engaging the union all over.

More Learning
Iva: I learned a lot from this experience. I learned that the people who
did not participate in the original thinking and planning would not buy in
because their inputs were not taken into account. I had thought that we
had had a pretty representative process, but then I realized that the people
who represented the unionized workforce didn't really represent them
because they didn't have the skill to ask people questions.
I guess this was my first major lesson in how to bring more demo-
cratic ideas into the workplace. I learned that you have to get inputs that
 Chapter 6 / lva's Learning Journey 119

are truly representative. I also learned that even when I think I have rep-
resentation it's very likely that I'm wrong. When I'm sitting at the top o f
the company it can easily look like somebody (a manager) represents
somebody else (another manager or an employee) in a way that makes it
possible for a project to be implemented, but true representation is very
difficult to obtain. I learned that I needed to be very sensitive t o that, but
I didn't know exactly how. This is a lesson that I didn't learn well enough
a t the time-and it would return to haunt me.
And still, I didn't want to give up on the idea o f a greater sense of
partnership with the union.

Crisis leadership Yields Positive Results

Iva: The turn-around process took three years. We moved the compa-
ny HQ in 1989 without skipping a beat. As a matter of fact, that was the
first year we made a profit. The quality of our products improved overall,
and we stopped the flow of red ink. Sales volume increased by 50 percent
and the company became profitable. In fact, we were on a par with even
Japanese companies doing business in the US. PDC moved from last place
in the industry and joined the ranks of the best among its competitors. There
were a few people who called this period a "bloodbath," but I believed that
all of it was necessary to save the company.
I know that i t was also necessary to use traditional command-and-
control tactics to get the results we got. In fact, when BusinessWeek
magazine ran an article on women in high tech they praised my efforts
as follows:
When Iva M. Wilson took over as president of Philips Display
Components Co. three years ago, the TV picture tube maker was
fighting for its life. Low-cost Asian producers had flooded the
US. market, and the company was in the red. The first woman
ever t o head a division o f Dutch electronics giant Philips, Wilson
moved decisively. She shuttered a plant in Seneca Falls, N.Y.,
slashed employment at another facility, while investing more
than $30 million to modernize production. Last year, the com-
pany broke even for the first time in five years on an estimated
$300 million in revenuesa2

Simultaneously, we began putting in place plans for a new, state-of-

the- a r t factory.
120 Part 2 / The Journey

Looking t o the Future

Third Strategy: The Dream Factory
Iva: Despite all the strides we had made, we still felt that we were
caught in a kind of winepress. We were in a highly competitive, commodity-
type business with low profit margins. At one end of the supply chain, a key
component of our product was in short supply and the price was climbing.
I saw that as out of our control. At the other end, over 80 percent of the
picture tubes we produced were sold to a single customer, a customer also
owned by the parent company. In sum, we were being squeezed between
the pricing of the product, which had to be kept low, and the cost of mate-
rials, which was continuously climbing.
Furthermore, due to increases in our product quality, we were also
experiencing a period of high demand, but we were simultaneously lim-
ited in our ability to produce. Also, if we were able t o produce larger pic-
ture tubes (called "jumbo" tubes) we could have gained more profit, but
our factory did not have that capability. We needed a way out.
While a t Zenith I learned about the Japanese way o f management,
Japanese processes and equipment, and their innate capability t o inte-
grate those into a whole system. Out o f that learning a vision of a new,
state-of-the-art factory emerged. I believed that building such a factory
was the strategy that would enable us t o achieve long-term prosperity
My reasoning was as follows: I believed we needed to grow the busi-
ness and take leadership position in the market. I was also convinced
that we would not be able t o accomplish this merely by upgrading the
existing factory. In order t o do that, we needed to expand our capacity
for producing products for the future, using the best technology avail-
able from Philips in Europe. I also realized that this would require a
change in the way people thought about and performed their work. Our
efforts in making these changes within the existing business infrastruc-
ture were, in my judgment, not fast enough. The reason went beyond the
technical issues. I believed that the culture o f the factory was a critical
ba r r ie r.
I believed that we needed t o change the workplace environment a t
PDC. If we were going to attain a quantum leap in performance we had
to alter the way people a t PDC thought about and performed their work.
We needed to create a new level of empowerment in the unionized work-
force that was resistant and hostile t o anything new. We thought that a
new factory would give us a clean slate. It would be a Greenfield-in
other words, a new location with new equipment and new people. In a
new environment we would be able to show by example what a "differ-
ent way o f working and leading" meant.
In this factory we could bring together new technology, new ideas
about how work should be done, and new models for managing people.
 Chapter 6 / lva's Learning Journey 121

It was our belief that the new facility would promote the change faster
than pursuing TQM in the old factory.
After a long and tedious process, we got the approval from Europe
and started construction of a new manufacturing facility. Unfortunately,
during this time period (1989-1991) Philips encountered major financial
difficulties. The consequence was that our factory project was eliminated.
There was also a lot o f restructuring going on a t a higher level. The
management model o f the company was changing and the worldwide
Philips HQ in the Netherlands now required us to report more directly to
them rather than to the US. HQ. There was more fallout from the can-
cellation of the factory. Also, we were about to enter into labor negoti-
ations. The new factory would have given management some leverage
with the union, because there would have been a second factory. Now,
since the Ohio factory was still the only shop in town, we had no choice
but to rethink our strategy.

Turning Inward
Iva: The loss of the new factory was a great disappointment, a real let-
down for me. Yet, in my mind, it was not a terminal blow because it is not
in my character to ever give up. I was deeply engaged in the business and
its people, customers, and products, and I did not want to leave. Looking
back, I can see that this event probably signaled the end of our autonomy
from the parent organization, but at the time I did not want to face that. I
continued searching for another strategic solution.
Now that our dream of a new factory had vanished, I knew that I had
a real challenge in front of me. I had to face the fact that the reason I
wanted the factory so much was because I didn't know how else to gen-
erate fundamental, profound change in the existing factory. I remember
standing in the old factory one night, thinking to myself, "What are we
going to do? Is there some other way to renew the company and to make
it more competitive in this fierce global environment?" I realized that our
relationship with our hourly workforce needed to drastically change, yet
the skills of that workforce did not seem t o make that possible. It wasn't
the skills of producing picture tubes that were deficient. In my view, it was
the listening skills, and the ability t o inquire rather than advocate-all the
skills necessary to create a good union-management relationship seemed
to be lacking.
I remember long evenings and weekends of discussions with my
management team and many others from the company about what to
do. We needed t o rethink our entire strategy and come up with some-
thing that would work within the existing manufacturing infrastructure.
It was during this time that I became especially intrigued by the possi-
bilities of organizational learning.
122 Part 2 / The Journey

Organizational Learning: A Radical New Commitment

A New Set of Strategic Tools
Iva: It was during this time that I became aware of Peter Senge and his
associates' work at the Organizational Learning Center at MIT. I was
intrigued by the application of systems theory to management science.
What struck me immediately was how systems dynamics-which I
was familiar with from a technical standpoint-could be extended to
human systems. This was extremely exciting! For a long time I had
thought that there was too wide a gulf between the technical aspects o f
the business and the behavioral aspects, the so-called "soft stuff." I
thought these t w o things needed to be integrated, but I did not know
exactly how. The essence o f OL is that it joins together, integrates, the
technical nuts-and-bolts o f business with the behavioral aspects. This, I
believed, was the framework I needed to build upon.
I had had a sense that there were aspects o f the business world that
seemed inexplicable. For example, business organizations are systems
but, unfortunately, we do not see them that way because we have a
strong tendency to a reductionist way of thinking. Because we have that
reductionist view, we only look a t parts, rather than the whole system. As
a result, we tend to focus on creating shareholder value, thinking that if
we satisfy the shareholder, everything else is going to fall in place. And
it's not that simple.
A more systemic view of business organizations says that their pur-
pose is to satisfy human needs. Shareholders are humans, customers are
humans, suppliers are humans, employees are humans, et cetera. That
focus on people is much more conducive to creating more wealth and
better economic conditions, but it's much harder to put into practice
because you have to deal with more complexity-which we tend to fear.
Our tendency to be reductionistic comes from a "mental model" o f
the universe that we inherited from the Industrial Age. We have learned
so much more from the work that is being done in the new physics, yet
this Industrial Age thinking is still the prevailing view, particularly in the
West. As long as a corporation is viewed as a mechanical system instead
o f as a living system, we will continue to use strategies like downsizing
to remedy our problems and we will suffer from those choices.3 All these
things will not change much until our mindsets change.
That connection with organizational learning started another phase
in my professional career. I saw another way, a better way, to create a
new strategy for PDC, and I was deeply convinced that this was the path
forward.
 Chapter 6 / lva's Learning Journey 123

The Strength o f M y Convictions

Iva: I strongly believed that "learning" was the right path for us. My
personal vision was very clear, but how could we develop a shared vision for
the organization? I had long believed that there was no way we'd ever suc-
ceed unless we changed our way of working. At first I thought that we could
accomplish that if we built the new factory, but that dream was ended.
Then, in reading about OL, I began to believe that perhaps we could accom-
plish the same result if we began to learn together.
The learning tools described in The Fifth Discipline seemed to offer us
a unique opportunity to develop a new business strategy that would
make us more competitive than ever. In fact, many o f those tools seemed
ideal for broadening the Total Quality Management philosophy a t PDC,
and for increasing the company's capacity t o generate the new ideas we
so desperately needed t o hone our strategy.
I believed that the OL conversational tools, such as Dialogue, would
help us to make better decisions. When we made decisions, we needed
to learn to distinguish when we base our judgments on data and when
we based them on assumptions or feelings. We also needed t o under-
stand the assumptions that underlay our actions. If we could understand
where our assumptions came from, how they are supported by our belief
system, and how they might have developed, then we could see our judg-
ments more objectively, and we would be better able t o suspend judg-
ment and thus come to a better decision. The Ladder of Inference as a
tool provided a real opportunity t o start thinking deeper about the
assumptions we held, why we held them, and how to sort them out.
It was also my firm belief that Systems Thinking would give us the
very tools we needed to rethink our business. This approach seemed a
huge improvement over the kind o f linear, reductionistic, cause-and-
effect thinking on which PDC had based most o f its decisions in the past.
I also believed that, in our technically oriented culture, systems dynam-
ics would prove easy t o understand and implement. Systems Thinking,
which has its roots in systems dynamics, would be understandable t o
both technical people and nontechnical people.

Defining a Change Strategy

Iva: It seemed quite clear to me that developing learning capabilities
and applying learning disciplines in our company would require a different
kind of commitment from the people in the organization. So, I felt that the
pertinent question was: How do we create that kind of commitment?
My change strategy was one o f deployment. I chose t o deploy the
learning effort through the HR and Quality departments and with their
respective vice presidents. The rationale for that was relatively simple.
First, the two VPs were very interested and involved in learning and
applying the tools o f OL. Second, I felt that the tools of OL would provide
124 Part 2 / The Journey

the opportunity to improve on existing Quality processes. Daniel Kim's

MIT working paper from 1990, "Towards Learning Organizations:
Integrating Total Quality Control and Systems Thinking," made that pos-
sibility very evident.4 Since the OL tools required that people become
engaged in the business in a way that would change the way they think
about themselves and the business they are part of, it was natural to use
HR as the other function to lead the deployment process. Only later did
I realize that this was another major flaw in my strategy.
The plan was t o gradually expose the people in our organization to
the learning tools and t o thereby develop their skill in applying those
tools in their work. I believed that people in all functional units needed
t o be exposed to these tools, and that we needed t o simultaneously
expose people on various levels in the organization, so that the deploy-
ment could be faster and more efficient. I also believed that we needed
to expose these tools to a diagonally cross-functional group of people
who could then take this process further and engage the rest of the orga-
nization. I expected t o achieve this through the educational programs
the MIT Center for Organizational Learning offered, project support from
researchers and consultants associated with the Center, and interaction
with people in other sponsoring companies.
This was similar t o the strategy I had used previously to bring new
ideas into the company from competitors and Europe. I had met with
resistance when I pushed those new ideas. I had also found myself
teeter-tottering between t w o leadership approaches: pushing for com-
pliance and working toward getting genuine cooperation. As I galvanized
this change effort, I did not anticipate that this same pattern would
return with even greater ferocity. We embarked on our organizational
learning journey in 1992.

First Tactic: Voluntary Deployment

Iva: Because my management team and I wanted to emphasize that we
were no longer operating from a command-and-control mentality, we
decided from the beginning that the initial training would be voluntary. The
plan was to train the most interested people who would then, in turn, take
the change process further by engaging the rest of the organization.
As it turned out, those people who had the most interest in leading
and supporting this change work tended t o come from the salaried and
nontechnical workforce. Few o f them came from manufacturing, the
function that had the most direct impact on PDC's performance. During
time of high demand for picture tubes there was intense pressure on our
manufacturing function t o pump out more tubes, despite PDC's limited
manufacturing capacity. As a result, the overworked manufacturing staff
had little interest in investing precious time in the change effort.
Reflecting on this time period, I question how voluntary this selec-
tion process actually was. All the desired participants knew that the
 Chapter 6 / lva's Learning Journey 125

president of PDC was supporting this effort. We were also still walking
around in the residue of a command-and-control culture. Therefore it is
quite possible that they considered participation in the program as
mandatory, or at least, "a good personal policy."

First Challenge: Commitment from the I ine

Iva: I knew that there was little hope of real organizational change
without the commitment and involvement of people from the line. But how
did we manage this? We did an assessment of the cultural differences
between the headquarters and the factory (our two locations).

Phil Fazio, former CFO o f Philips Display Components

(PDC): The factory culture was very pro-union brotherhood, sol-
idarity, and distrustful o f management. They kind o f had the
view, "We've been doing this for forty years, don't tell us any-
thing new. We've been through all these fads. Just give us good
equipment, good pay, and leave us alone."
It was very much a midwestern, rural culture with strong
family values, strong religious beliefs, and not really any interest
in too much change. And a few could lead many.

Iva: We concluded that despite the significant cultural differences

between the t w o locations, it was paramount t o include both in this
process. We anticipated that the importance o f interdependence
between the two, already stressed through our Quality drive, would min-
imize any problems emerging during the new initiative.
Unfortunately, because the first people to attend OL training were
primarily from HQ, the factory people framed it right away as the presi-
dent's project, "another corporate initiative." They concluded that it had
nothing to do with what was going on in the factory, so they wouldn't
have to worry about it.

Second Tactic: Using Dialogue to lmprove Conversation

Iva: As more of our people began attending the OLC course, the PDC
management team encouraged them to use organizational learning tools as
much as possible in all aspects of their work, such as in the strategic plan-
ning process, product development, and so forth. These tools included team
learning and conversation tools such as:
Balancing advocacy and inquiry
Left- hand/right- hand column
The Ladder o f Inference.
126 Part 2 /The Journey

The first group t o be trained in OL was charged with figuring out

how to introduce OL into the organization. They decided t o focus on
Dialogue.5
I was particularly committed to Dialogue for the following reasons.
We have all experienced conversations that lack focus, as well as those
that generate new ideas and move the creative process forward. To
develop the "conversational muscle" necessary for what Senge terms
"generative conversation" in an organization, we need to understand the
mental models we create through our thinking. However, without shar-
ing our aspirations and building them into a shared vision, it is difficult
t o create outcomes that support both individual and collective aspira-
tions in the organization. Dialogue as a process supports creating more
effective conversa tions.6

Early Resistance
ha: Initially, it was difficult to get Dialogue to be accepted in our cul-
tural environment. We were a very crisis-oriented company. We tended to
react to the most immediate problem and converge on solutions quickly,
rather than set priorities and maintain a course of action that deals with the
long-term issues. We were also very task-driven. Dialogue slowed us down-
and it was seen by many of our technical and line people as being too con-
suming of precious time and too "soft"-not sufficiently linked to business
results.
Then there was the issue of trust. Many people were afraid t o be as
open as Dialogue required. They wanted t o play it safe, especially
lbecause management was present a t the Dialogue sessions. I very much
'wanted there t o be openness and for people to speak their truth. I very
lmuch wanted to create an organization where people could feel free t o
'jay the truth in public, rather than just in private. I tried to model that
behavior, but as much as I wanted people t o be open, I also turned out
to be part of the problem.

Phil Fazio: Quite honestly, I think people were afraid a t the

time to say a lot about specific problems in the factory with Iva
there. Iva was perceived as a very intimidating person. She was
really strong in her conviction and I think as a consequence they
missed a lot of things that she was trying to get them to learn.
They also knew that if she wanted to do something, that you
lined up and you did it. That was "the early ha." That was before
Iva did some learning herself and managed differently.
 Chapter 6 / lva's Learning Journey 127

Challenging My Leadership Style

Iva: This was a time of tremendous learning for me. As a result of the
Dialogue sessions, I began to get glimpses of how I might be acting in a way
that was contrary to my beliefs, and I tried to make changes. I tried to be
more reflective, to be increasingly more accessible to people, to be more the
creator of an environment in which people could feel freer to be open.
However, I would slip into my old command-and-control style; I would
"backslide." This would do quite a bit of damage because then, in some peo-
ple's eyes, I would undo the good work that had come before. Yet, there
were others who could see that I was genuinely trying to embrace this new
path.

Expanding the Organizational Learning Effort

Iva: I strongly believed that OL was the way out of the situation we
were in. In early 1994, I made the commitment to implement the learning
tools on a companywide level. This meant that OL became more than a cor-
porate program that no one in the factory had to concern themselves with;
it was a mandate for the organization. I also began to push some of the OL
techniques, tools, and teachings up into the Philips organization in Holland.
I pushed pretty hard and had the VP of HR and the VP of Quality engaged
in the process.

Resistance and Faltering Results: The View from the Factory

Iva: We wanted the Dialogues to be representative, so we had the peo-
ple from the factory come for the sessions, which sometimes involved up to
30 people. I felt that this was very important for our growth as a whole
organization, but it was also true that the people from the factory were on
the horns of a dilemma. On the one hand, they were under great pressure
to produce. On the other hand, they were being asked to give up their time
for something they did not see as being specifically job-related. If they were
only there because they were merely being compliant to my wishes, then
that went against our long-term goal of participatory management.

Phil Fazio: Around this time, performance was starting t o

deteriorate. We weren't selling as many products. We lost a cus-
tomer because o f an internal quality problem. There was a lot of
internal pressure because most o f our tubes were being sold to
our own internal sister company and they wanted price reduc-
tions. We started having performance problems in the factory
with scrap being up and yields being down. So there was a lot o f
stress in the organization.
128 Part 2 / T h e Journey

Some of these issues came up in the Dialogue sessions, but

I cannot remember a time when any action items came out of
dialogue or any decisions were made on those actions. It was
always presented as getting things off your chest, putting things
out in the middle, and not necessarily worrying about solving
them. And that drives factory people crazy.
As far as being an effective tool for opening people up and
getting feelings out, I think Dialogue was very successful-but it
was very disjointed. There was nothing systemic in place to deal
with some of the issues that surfaced in Dialogue. And some o f
these things were emotional and people were spilling out their
guts-then it was "Let's all go back and get to work." It was a
difficult time. People didn't know how to handle those things.
I was concerned that we were only doing Dialogue. I used t o
tell Iva, "Look, we're only doing one of the learning disciplines.
We're focusing so much on Dialogue that people are feeling that
all we do is talk and we never made any decisions." Furthermore,
the European HQ was beginning to have much more influence-
and what had previously seemed like "influence" was now shift-
ing to "orders." There was more need to justify our actions.

Fourth Tactic: A Project in Process Management

Iva: We had been actively looking for a meaningful project to which we
could apply organizational learning. So, I continued pushing and we even-
tually had a project, Process Management (PM), that I felt gave us the steps
to not reengineer, but to recreate our processes. The next step was to bring
OL tools to bear on a process improvement effort. The idea was to use
reflection and Systems Thinking to help the Process Management team
think through the "why" of a process before rushing to revise it. We called
this "process re-creation." We were looking to shift from discrete process
improvement to a mentality of continuous process improvement. The work
was beginning to show signs of success. At the same time I was bringing all
these ideas to Europe. M y peers from other regions, such as South America
and SE Asia, seemed very receptive and supportive to me.
However, as we went about this process, the more technical tools of
Systems Thinking, such as simulation modeling, were not being employed
nearly as much as the other tools. This was because, as mentioned earlier,
the initial round of people who expressed interest in organizational
learning came from nontechnical backgrounds and felt most comfortable
with less technical tools. This imbalance would have important ramifica-
tions later.
 Chapter 6 / lva's Learning Journey 129

A Sea o f Conundrums
Iva: During these early stages, several challenges arose. The European
management did not understand why, given the bottom line results, there
was a push for Dialogue, which they saw as just sitting around in a circle,
talking, with no actions being taken. This was certainly not their model for
how you deal with business problems. That began to add strain to how they
perceived the company was performing as well as their perception of how
the management of the company was performing.
In the background, there was a kind of "tug-of-war" going on-a
struggle between PDC's desire for autonomy and the parent company's
desire for more control. The desire for control kept getting stronger and
our ability to control our destiny seemed to be diminishing. There were
also tensions in the business relationship between PDC and its main cus-
tomer, another Philips company, which sparked resentments and criti-
cism on both sides. Both companies were facing an especially challeng-
ing time owing t o the relentless lowering o f TV set prices a t the retail
level. We gave this customer a sizable volume discount, but they never
felt that it was enough. We felt that we couldn't reduce our costs any
further unless we made further capital investments. The parent company
would approve these only if PDC increased its profitability. We were
locked in a not-uncommon catch-22, a vicious cycle. This not-so-merry-
go-round would drag on for years. There was a lot o f blame flying back
and forth, but very little willingness on either side to grasp the underly-
ing causes o f the friction or to join forces to find a win-win solution.
As a result of my work with OL, I thought I had a fresh perspective
on this rivalry. It was clear that the situation could not continue on this
track without causing serious damage to one or both companies. I wanted
to explore the root causes of the t w o companies' conflict because it
might unveil leverage points for improving matters. I was not able to act
on this intuition, however. I had an excellent relationship with the pres-
ident of the company that was our biggest customer. We respected each
other, we trusted each other, and were therefore able to speak about the
things that troubled us the most. We shared our views with Peter Senge
and elicited his support, which resulted in his recommending a consul-
tant to work with us. We both decided that this process needed to be led
by the customer and not the supplier, i.e., the other president had t o take
the lead. However, we both also decided that the conditions were not yet
right to start reshaping the relationship, and so the tensions between the
two companies continued to worsen over time.

The First Setback

Iva: The first setback came as a consequence of a worldwide job satis-
faction survey of Philips employees. When the results came back, PDC's
results turned out to be lower than our peer divisions. The parent company
130 Part 2 / The Journey

management took note of these survey results and a negative picture was
beginning to form in some people's minds. A former peer had recently
become my new boss and he was watching our performance closely and
becoming critical.
In response, I asked that one of our external consultants help to
interpret the results. We knew that we were the only division that actively
encouraged hourly workers' participation in the survey. In an effort t o
include everyone, we actually paid overtime t o the unionized workers so
they could respond to the survey. This was an unprecedented move and
now it began to seem politically na'l've on our part. When we analyzed
our survey responses, we discovered that the unionized workers' responses
were much less positive than those o f our salaried workers, which great-
ly biased the results of the survey. The unionized workers had never been
surveyed before, so they naturally took the opportunity to voice their
concerns. Although we tried to explain the disparity to upper level man-
agement, their opinions seemed t o have already been formed.

Success Brings Some Unintended Consequences

h a : Yet, I was not overly concerned. The parent company was going
through a difficult period, yet I believed that we at PDC were making
progress in Quality as we received IS0 9000 certification in the latter part
of 1994.
Due to our TQM work, PDC had become a leader in Quality, winning
high ratings in a peer evaluation. Our customers were now demanding
ever more deliveries-but we did not have sufficient capacity because our
new factory was never built. The continuous struggle to fill deliveries
with our limited production capabilities put a huge strain on the entire
organization and, because we could not meet all of our customers' needs,
our reputation was beginning to suffer.
In response, the only thing we were able to do was drive our work-
force harder. We tried t o increase production by adding more working
hours, working people in the factory with overtime t o their maximum
capability. The pressures were unbelievable, but we had no other choice-
or at least we did not know how to look for other choices. And although
the hourly workforce were making more money because of overtime, the
morale and the satisfaction in our factory were dwindling.

The Strike: A Crushing Blow

Iva: Then, in the fall of 1994, the stress between management and the
union crystallized. A conflict with the union arose because we wanted to
add an extra shift. Unionized employees were divided between those who
supported unlimited overtime, and those who preferred not to work over-
time and supported an extra shift instead.
 Chapter 6 / lva's Learning Journey 131

In the spirit of my new leadership style, I had delegated the contract

negotiations. I had also changed another key element o f the negotiation
process: my personal involvement with the unionized workforce. This was
the first time that I chose not to meet with the entire unionized work-
force before the negotiations. Previously I had always engaged with them
personally. I shared management's reasoning about what was in the con-
tract and answered their questions. Several other things were different
this time also and the outcome was not what everybody had been assur-
ing me it would be. By a small margin, the unionized workforce decided
t o reject the contract and they went on strike for the first time in 25
years. The strike only lasted a week, but it had a significant impact on
the business. When the strike occurred, inventory was down and we did
not have reserves. The factory had to be shut down. This was the first
strike in PDC's history. It was a surprise to me and, more importantly, a
surprise to my bosses in Europe.

What Can We Learn from This?

Healing through Learning and Dialogue
Iva: Not only did the parent company take notice, but the strike had
intense repercussions within PDC. During that summer, an oppressive sense
of unhappiness blanketed PDC's labor force. The manufacturing staff
seemed particularly dispirited.
Everything that I had learned by doing the work within organiza-
tional learning told me that I must stay on the course that I had begun.
I knew that if I came down with repercussions and "punishments" for the
strike that I would destroy everything I'd built so far. I still believed that
if I continued using the OL tools and methods that I started implement-
ing in the company, we would find a way out o f this morass. I also
believed that everyone involved-the management, the salaried workers,
and the union members-needed to grasp how all our actions had pre-
cipitated the strike.
I found myself thinking about ways in which the company could
learn from this disaster. So I gathered a group o f 60 people, from both
headquarters and the factory, to take part in a facilitated Dialogue for
this purpose. The Dialogue went on for an intense, emotional two days
and surfaced many profound insights. Obviously, a lot o f people on both
sides, management and the union, were deeply hurt by the strike. Many
salaried employees resented the union for taking those steps. There were
also conflicts within the unionized workforce. Conflicts often involved
family members, friends, or neighbors pitted against one another.
I believe that the use o f Dialogue methods helped reduce the amount
o f blaming despite the intense pain that people were feeling as we dis-
cussed these issues. Management began t o acknowledge some of the
mistakes they had made during the negotiations. We acknowledged our
132 Part 2 / The Journey

ineffective communications, and our lack of true understanding of the

reasons why employees were divided on the issues of overtime and the
need for an additional shift to increase output. We had not fully under-
stood the impact of our demands on personal lives of employees.
Amazingly, no one lost his or her job during this grueling analysis.

A New Beginning?
Iva: We used this learning the next spring, 1995, when we reopened the
contract negotiations. During the subsequent 6-8 months the organization
was deeply involved in the work leading to a better understanding of the
system that created the conditions for the strike and finding the leverage
necessary to take the next step. I felt that the tools of the learning organi-
zation enabled us to successfully ratify a contract within six months from
the strike, a feat that was previously deemed impossible. The new contract
gave us the opportunity to increase the factory output. It also opened the
door for improving working conditions within the factory and creating a
more satisfying environment for our employees. I therefore believed we
could easily justify to management above me that our new initiatives could
bring results.
During this period we also made great strides with Quality. In 1995
we passed Philip's Peer Quality Audit. This award gave PDC significant
recognition for its pursuit of Total Quality Management, which had
included the application of the tools and methods from The Fifth
Discipline. In fact, the Philips Quality Auditor who visited our plant noted
how committed the factory workforce was to their customers and how
proud they were of their company. This surprised him because he expected
to find a different attitude after the strike. This was a great sign of
progress and confirmed my belief that it was only a matter of time before
my boss would also "see the light" despite the strike and the survey
results.
After the strike, however, several people on my management team
urged me to go underground with organizational learning, but I didn't lis-
ten. I was optimistic because I believed that PDC's management and
union members had scored some major successes in their resolution of
the strike. I was still confident that I could make significant changes in
the company and that I could persuade my boss by giving him evidence
of how these learning organization things are really making a difference.
I was confident that i f I showed positive results I would be home free.

Fiddling While Rome Burns: The View from Above

Iva: I had been very vocal about my commitment to organizational
learning. I'd taken the message to Europe several times and was an advo-
cate for everyone else embracing these ideas. Now I was totally exposed.
 Chapter 6 / Iva's Learning Journey 133

The strike caught the attention of upper level management. Management

from the European HQ began frequent on-site visits.

Phil Fazio: Two levels o f upper management came to PDC t o

get debriefed about the strike. They said things such as, "You say
you're doing all this good learning, you're getting in touch with
the workforce, you're driving cultural change-then you have a
strike. If you're doing all this great stuff with the people, we can't
understand how the heck you can have this kind of a problem."
Their perceptions went to judgment. They flat-out said that
Iva was doing a bad job by focusing the company on the wrong
things. They would come from overseas and go directly to the
factory, skipping the PDC HQ, and form their own opinions based
on what they saw and heard. The management of the factory
actually made presentations t o some of the management from
overseas. In these presentations they showed that a decline in
yields in the factory was happening a t the same time that all
these other initiatives on learning and other things were going
on, and making a cause-and-effect relationship between the
two. This was a deflection tactic; they probably exaggerated this
relationship.
Now there arose in PDC the strong perception that i f you
were too visible in supporting some of these things that the
president was promoting, you were a t risk for your job. The per-
ception was that if you were working on "that soft stuff" while
Rome was burning, you couldn't be very valuable to the company.
You're driving the agenda away from where upper level man-
agement thought it should be. There was division on the man-
agement team.

A House Divided
Iva: In late 1994, after I realized that our organizational learning efforts
were not necessarily creating the intended consequences, I decided to have
a three-day off-site meeting to discuss this with the management team.
Those were very difficult days in the history of the management team, but
also very gratifying for me because I was able to use what I learned in the
past several years and apply it "in action." I believe the same was true for
others on the team.
An outside consultant helped us to discover that my management
team appeared unable to agree on the relevance and importance o f spe-
cific initiatives, particularly the learning and process management
efforts. The management team appeared to be divided into t w o camps,
each with its own priorities. One camp, consisting o f people associated
134 Part 2 / T h e Journey

with staff functions, championed and promoted the learning organiza-

tion activities. The other camp, which consisted o f operational people,
was concerned that the organizational learning activities took too much
time and diverted energy and attention from critical business priorities.
The managers in this camp sought to avoid activities that weren't
focused on production.
We also learned that these two camps didn't trust each other and
this distrust affected the ability of the management team to set consis-
tent priorities. Moreover, we learned that they didn't believe that they
could tell each other the truth. And-even more critical-they didn't
believe that I would listen if they said something with which I disagreed.

Phil Fazio: When Iva became the president, the company

was in terrible shape and she really turned it around. People will
tell you that that was when Iva was performing her best in the
president's role and that it wasn't until she got involved in some
o f these other things that performance began to deteriorate.
M y perception is that there wasn't enough of a balance. The
pendulum had swung too violently in another direction-toward
OL, let's say-and that gave the perception that management
had taken its eye off the ball and was not addressing the imme-
diacy o f the problems.
We all had that feeling at some point in time and we would
have discussions about it, and try to tell Iva. But the points maybe
weren't made strong enough, or they weren't heard, or they
weren't communicated properly-whatever-they didn't sink in.
There became a great division on the management team. It was
perceived that a small group had influence over Iva and they were
actually driving her away from a focus on the business activities.

Iva: It is entirely possible that the "breakdown" in my management

team was actually foreshadowing a "breakthrough" to a greater level of
honesty. They were now willing to openly tell me what was going on-and
perhaps, for the first time, I was willing and able to listen. I felt that we
experienced a significant change in the level of trust within the organi-
zation. This created an opportunity to expose the disagreement with new
initiatives. Unfortunately, we were running out of time. Word of this dis-
sension had been informally communicated to my boss in Europe. It had
been reaching him, but I had not heard it until then. When those com-
ments, with best intentions, were made to the management above me, it
created a good reason for my boss to question those initiatives led by me.
 Chapter 6 / lva's Learning Journey 135

Our management consultant also uncovered that people in the fac-

tory believed management was delivering mixed messages about the
value of organizational learning to the workforce. As a result, there was
a split in the organization between those who supported the OL effort
and those who did not. The lack of support came primarily from t w o
sources: lack of understanding and lack o f agreement. Those views con-
tinued t o create conflicting messages and, with time, further eroded my
boss's confidence in the validity of the approaches applied in PDC.

Phil Fazio: The perception that the initiatives were driven by

the HR and Quality functions did not help because they were
seen as being outside the business, outside the guts o f the oper-
ation. So it seemed that there really was a separation. There was
the part that worries about running the business and the part
that does other stuff. It really became divisive among the team.
It became dysfunctional.

Iva: As a result of these discussions, we decided to initiate a project

t o assess the organizational issues within PDC and its relationship t o the
global business. I felt we needed to deal with some fundamental differ-
ences between my boss and myself regarding how the business in the
US. should be organized. Unfortunately, I did not appreciate how serious
the disagreement with my boss had become. I compounded the situation
by refraining from direct communication with him and instead commu-
nicated with the three consultants who were performing the organiza-
tional assessment. I thought that these individuals had the professional
understanding o f the efforts we were introducing, and the ability to
communicate with my boss in a way that would help him understand the
fundamental thinking behind the effort. Upon reflection, I realize that
this decision had numerous unintended consequences-as I once heard
Dee Hock say, "not all intended consequences of our actions materialize,
but all the unintended do!"' Still, I remained confident that we would
reach an agreement.
After a four-month-long study it became clear that the recommen-
dation was t o reorganize PDC t o be more in line with the organizational
structure o f the parent company. Among other things, the factory was t o
be given increased autonomy from PDC HQ. In addition, the responsibil-
ities of the VP o f HR and the VP o f Quality were greatly reduced since
the corporate function was restructured. Responsibility and accountabil-
ity for human resources and Quality in operations were fully transferred
t o the newly established position o f Business Team Leader (formerly the
VP of Operations).
136 Part 2 / The Journey

No latitude without Results

Iva: As far as results were concerned, we were lagging behind other
Philips plants around the world in terms of return on assets. Because of the
strike and the messages my boss was receiving about the pressure on the
people to be engaged with organizational learning, my boss was becoming
convinced that my interest in organizational learning was distracting me
from focusing on the parent company's priorities.
I could rationalize this. I believed this shortfall to be caused by the
lack of capacity in our old factory and outdated processes that we were
attempting to revise through our process management efforts. I could see
that the parent company wanted more immediate gains from the factory,
but I was convinced that our efforts would yield better gains in the long
term. We were completely out of synch in our thinking about time.
When my boss and I finally sat down face-to-face t o discuss the
reorganization plan, I learned how things looked to my bosses "from
above." In summary, my bosses had become unhappy about my leader-
ship of the business. They decided that I would not be able to do what
was necessary t o increase the business's profitability, such as laying peo-
ple off in order to reduce costs and improve PDC's bottom line.
They were right on that point. In my view, laying off people does not
necessarily lead to a reduction in a company's overall costs. We generally
think there is a direct correlation because our view o f labor costs is sim-
plistic a t best. We only take into account things we can easily measure.
We'd have a better picture i f we could take account o f not only the
wages we pay them, but also the quality of the work we get from their
full participation in the process. It was more important t o me to use our
learning from successes and failures in order to create efficiencies and
better output. I therefore committed to our workforce that I would not
pursue a strategy of restructuring by laying off people. Instead, I focused
on improving our business processes and creating a learning environment
so we could achieve better results. So, my bosses were right. I was not
going to agree t o lay people off.
M y boss also questioned my leadership. He deemed my new manage-
ment style too "soft," citing that I should have fired a few people after the
strike. As he often said, "You have twenty-first-century ideas, running a
twentieth-century company, and this will not work. You have to do some-
thing more traditional first." He believed that the people who were
responsible for OL, the VP of HR and the VP o f Quality, should go. I did not
agree. Together, we decided that I should leave PDC by the end of 1995.
Quite rapidly, organizational learning disappeared without a trace.

Staying with the Commitment

Iva: I was appointed the Senior VP of Manufacturing Technology for
Philips US. I did not abandon my beliefs, I continued pursuing my vision.
 Chapter 6 / lva's Learning Journey 137

While in this position we developed a Manufacturing Training Program for

all Philips manufacturing plants in the US. that contained many of the
learning disciplines. We might not have advertised it as such, but the peo-
ple who got the training were very enthusiastic about what they learned
and expressed how helpful this was in managing their jobs and people more
effectively. The program is still being used today.
I retired from Philips a t the end o f 1996.

Epilogue
ha: My first organizational learning journey lasted about four years
(1991-1995).8 That was a period of tremendous learning for me-learning
which continues to this day in an even more robust phase. Whether the
efforts I initiated while working for Philips should be called a "success" or a
"failure," I believe I learned a lot in the process of struggling to implement-
and especially in the process of reflecting on it since.

Phil Fazio: There was no major transformation of the orga-

nization, but the success, I think, is with the people who learned
a little about themselves, a little about some of the tools and
techniques, and are using those things in the places that we are
now. It is in the way we behave and the way we are in meetings.
I can balance advocacy with inquiry in difficult situations. I can
now use creative tension. That's where I think the success was:
with the people that took the time t o actually learn. It changed
some people and gave them a different tool set that they didn't
have before and I think some o f us are pretty successful where
we are today.
Personally, I feel I've been very successful and a lot of it has
been because o f some o f the things I learned as a result o f this
exposure to organizational learning. That isn't bad.

Iva: One of my biggest questions has been: "What would I do differ-

ently if I had a chance t o do it again?" Unfortunately, we do not often
get the opportunity to apply the lessons learned from our mistakes, even
though we all know that this kind of learning is the most powerful one.
On the other hand, by sharing what was learned somebody else might
learn from our mistakes.

Phil Fazio: I've learned that for a leader t o be successful

over the long haul, it's very important t o have a vision, a core
philosophy, and t o be true t o that vision-to follow it and live it.
But you also have to have flexibility in your strategy. You can be
totally committed t o your vision, but you shouldn't be totally
138 Part 2 / T h e Journey

committed to your strategy. You have t o look for opportunities

and then show flexibility. Your strategy and tactics can change.
If your strategy doesn't fulfill your vision, change your strategy,
but not your vision. Don't change your core belief.
I think where things failed with OL a t Philips was that it was
very much a vision and a core philosophy that Iva developed. She
was successful in getting it passed down to certain members o f
her management team. But she was not flexible in the strategy
or tactics for implementing. That I believe, in hindsight, killed i t
and it caused catastrophe for many people. That was a hard les-
son to learn.
That doesn't mean that people didn't think it had value or
didn't like participating. But I don't think it was ever perceived
as a way to solve problems or a way t o drive change or deal with
culture. I think that's because we didn't do the whole program
using all five disciplines. We focused on Dialogue. We primarily
used one tool and people really could not understand the whole
program.

Iva: I very much value Phil's perspective and I have learned from it
particularly about the need to plan for how t o use all the tools o f orga-
nizational learning even if some seem to be more compatible with the
culture than others.
Ever since I left Philips, I have worked to deepen my understanding
and continued the practice o f implementing these principles in my work.
This has not been an easy path, because reflecting on the past created
many opportunities to recognize my errors and mistakes, but the learn-
ing that came from it made it all worthwhile. It has been a real joy to see
how this learning has impacted the results I have produced since. I am
now convinced even more that the world will continue on this path of
change.

Endnotes

1. For a deeper insight into the subject, please refer to The

Learning Curves in Business, Jeff Mortimer (ed.), (Troy, MI:
Momentum Books, Ltd.), pp. 371-334.
2. Emily T. Smith, et al., "The Women Who Are Scaling High
Tech Heights," BusinessWeeh, August 28, 1383, pp.86-88.
3. For a more in-depth understanding of how a corporation can
be defined and viewed as a living system, refer to Arie de Geus,
The Living Compuny (Boston: Harvard Business School Press,
1937).
 Chapter 6 / lva's Learning Journey 139

4. Daniel Kim, Toward Learning Organizations: Integrating Total

Quality Control and Systems Thinking (Cambridge, MA: MIT
Sloan School of Management, 1330).
5. Iva Wilson, Organizational Change at Philips Display
Components, Innovations in Management Series (Waltham,
MA: Pegasus Communications, 1333).
6 . For a better understanding of Dialogue as a process and its
application, refer to William Isaacs, Dialogue and the Art of
Thinking Together (New York: Doubleday, 1333). Also see
Daniel Yankelovitch, The Magic of Dialogue (New York: Simon
& Schuster, 1333).
7. In his book, Birth of the Chaordic Age (San Francisco: Berrett
Koehler Publishers, Inc., 1333), Dee Hock describes his work
in creating VISA. This is a good example of a practitioner's
experience in applying the concepts and tools of organiza-
tional learning, although he does not characterize it that way.
8. In order to get further details about the learning journey, it
might be useful to the reader to refer to the learning history of
that part of the journey: JoAnne Wyer and George Roth, The
Learning Initiative at Electro Components (SOL Publications,
1337; online publication found at www.sol-ne.org/res/
wp/index.html).
Chapter 7
Debriefing Iva's Story

How does Iva's journey illuminate the pathway for others? Iva's
OL change effort was not "successful" in a conventional sense. The
change effort was shut down. New management was brought in.
Nothing diffused. But this is a success story in the larger sense,
because it gives us a rich opportunity for learning and exploring
deep questions about large-scale change. Furthermore, there were
pockets of awakening. Real change takes time. Profound change
may well have been occurring, but we lack the measures to prove
it. The only guideposts we have are the instances of resistance.
Each signal of resistance can also be interpreted as a sign of
progress. Change happens even as it is being resisted.

Iva's Early Change Strategy: Turn the Ship Around

When Iva assumed the position of president of PDC, she quickly
realized that she had inherited multiple challenges. From her
experience with Japanese companies, she also had a vision of what
a competitive organization looked like-and, in her mind, there
was an enormous gap between that vision and what she saw at
PDC. Yet, she also saw great potential.
Iva's first priority was triage; she had to apply tourniquet mea-
sures to stop the flow of red ink. These turnaround measures
involved closing a plant and moving the headquarters: in effect,
downsizing. While Iva attempted to do these things with as much
sensitivity as humanly possible, downsizing always carries with it
certain baggage. The ghosts linger; feelings of anger, resentment,
or fear are stoked. So, while there is on the one hand this great
desire to create something, to set people's aspirations free, the first
step involves a walk through the fire. How did people in the orga-
141
142 Part 2 / The Journey

nization perceive this first major move by its new president? Were
they truly able to rationalize that this was being done for the
greater good of the organization? On the other hand, did Iva have
any other alternatives?
These are hard questions and there are no easy answers. The
point is that they are organizational realities. All actions beget
reactions. Some predictable and intended, others not. When we
must take an action, it is a good idea to take a hard look at the
assumptions that we are basing those decisions on, and to test
those assumptions with others. Then, look for the reactions. Look
with new eyes; notice what surprises, not just the confirmatory
outcomes.

The Organizational Context

Ivas change strategy was to be implemented within a context that
had many sources of conflict and tension. A quick survey of the
situation shows that there were internal divisions and structural
tensions on multiple levels. For example:
The parent company and the subsidiary (PDC) were resis-
tant to accepting each others technology ideas; eventually,
the tension between the two escalated into a struggle
between autonomy and control.
There were tensions between the supplier (PDC) and its pri-
mary customer, also a subsidiary of the larger parent com-
pany.
There was long-standing animosity between labor (the
union) and management.
There was also a related tension between the culture of HQ
and the culture of factory.
There was growing but covert distrust on Ivas management
team, particularly between staff and line, which ultimately
led to a split on the executive management team.
The existence of so many multiple tensions raises some ques-
tions: Can learning efforts be effective when they are seeded in
such shifting ground? Conversely, can learning efforts be the
source of resolving these tensions? The energy devoted to holding
these tensions at bay-to keep from flying apart-gets in the way
of having enough energy to deal with organizational learning and
change. Can change leaders help organizations balance and
hold these tensions while simultaneously attempting to under-
go change efforts?
 Chapter 7 / Debriefing lvas Story 143

Ivas Challenge: Turn Shell Shock into Creative Energy

Now that Iva had stopped the hemorrhaging, she had to ask her-
self another question: What was the key to turning the dying
patient into a vigorous, thriving entity? Her first solution was the
dream factory. When the new factory was cancelled, Iva found new
hope in organizational learning. She believed that the future of
the firm lay in creating the conditions within which people could
flourish. In a sense, this was Ivas implicit theory of change: create
the environment in which aspiration can take root-and the business
results will follow. A time delay is implicit in this approach.
In Ivas view the gap between her vision of a high-perfor-
mance, participatory, vigorously competitive organization and
PDCs current reality had two facets. There was the technological
gap brought about by the long-standing lack of investment in fac-
tory operations and there was a culture gap. This perceived cul-
ture gap was characterized by the existence of multiple subcultures
such as engineering, marketing, and the factory. These subcultures
did not communicate well with each other nor did they function
interdependently as a cohesive whole. In addition, Iva inherited a
disempowered workforce. The previous management of the orga-
nization had been very much command-and-control. The
takeover by Philips exacerbated the submissiveness of many of the
employees; it left the organization defeated and even more com-
pliant. The organizations life force-its creative energy-would
have to be rekindled. What was the way of being that would
enable and engender this transformation? The issue, then, became
one of strategy and tactics-and something more.
In response to this assessment of current reality, Ivas overall
change strategy was multifocal. It began before she became inter-
ested in organizational learning and it encompassed the following:
Iva addressed the conflict between HQ and factory cultures
by attempting to develop a new corporate culture.
She attempted to address the union-management relation-
ship through repeated efforts to evolve and improve the rela-
tionship.
She also made an attempt to address the relationship
between her company and their chief customer. However,
the customer company wasnt ready or able to respond to
her overtures.
Great effort was made to improve the capability of the man-
agement team to work together as a team. Iva also was work-
ing hard to develop her own leadership abilities.
144 Part 2 / The Journey

Because of the technical focus of the company, there was a

gap in soft skill knowledge and skills. Few conversations
were skillful or generative. Iva hoped to develop those skills
by introducing many in the company to the conversational
tools that supported organizational learning.

Interpreting the Change Strategy

If we look at each of these efforts, we can see that the attempt to
develop better relationships between the different factions is a
recurring theme.
One way of interpreting the passion that Iva had for trying to
transform her organization is to view the situation through the
lens of Argyris and Schons Model I and Model I1 theories-in-use.
As we have said, Model I is characterized by defensive behaviors.
In environments shaped by Model I, people tend to advocate and
dont seek to understand the positions of others through inquiry.
Model I values and behaviors tend to create a reinforcing loop
which in turn creates an organizational learning system that
reflects Model I. That learning system in turn limits the learning
potential of both individuals and the organization. The system
perpetuates defensiveness and is a closed, self-sealing system. It
does not support the questioning of assumptions and therefore
does not support double-loop learning.
In actuality, Iva was not explicitly trying to create a new orga-
nizational learning system based on Model 11. However, we might
see Ivas efforts as emanating from a Model I1 framework in that
she was attempting to cocreate situations and tasks and to share in
the responsibility for outcomes. She was seeking to build these
factions into a viable decision-making network and to maximize
the contributions of each member enabling the widest possible
exploration of views. These are all hallmarks of Model 11. Had Iva
been able to see her actions within the context of this framework,
she might have better understood, anticipated, and responded to
the difficulties that arose.
In Ivas mental model, relationships were the foundation, the
bedrock, of effective functioning. In her view, if we have a good
relationship, we will have openness and trust. And if we have
openness and trust, then of course we will be inclined toward
Model 11 values. The first step, of course, was to develop the trust
and the skills to act in accordance with Model 11. Hence, Ivas ini-
tial focus was on the OL conversational skills and dialogue.
In Ivas mind, the connection between the importance of rela-
tionships, the efficacy of conversation, and the end goals of Model
I1 behaviors was implicit and self-evident. In her vision, there was
 Chapter 7 / Debriefing lva's Story 145

a clear connection between what the organization was attempting

to learn and the development of PDC into an organization where:
Search is enhanced and deepened;
Ideas are tested publicly;
Individuals collaborate to enlarge inquiry; and
Trust and risk-taking are enhanced.'
In other words, Iva envisioned PDC as a learning organiza-
tion.

Awakening Aspirations
In our view, the primary theme that threads through Iva's story is
her struggle to awaken in others that which had been awakened in
herself. Whereas Bert was consistently in touch with his devotion
to customer service, waiting patiently for the time and place to be
right so that he could put his ideas into play-which he believed
OL provided, Iva's experience with organizational learning was
even more cathartic. Beyond seeing OL as a strategy for the long-
term viability of the firm, OL also reawakened her aspirations and
put her in touch with that which she truly believed.

Iva: When I got involved with Senge's work I saw that there was
another way to lead. It was like a light bulb went on. My body responded
to it. I felt this enormous energy. And when I have energy, I act out o f
energy. That propels me into the future.

Senge very much believes that people in organizations need to

aspire to things they care about; organizations need people's aspi-
rations. Iva's story crystallizes for us what deeply felt aspiration
looks like. Iva's change effort was animated by her deep desire to
create greater freedom in the workplace.
Without completely realizing it, Iva had long been on a path
of discovery. Iva was clearly a "lifelong learner" who embraced
new ideas easily, particularly when these ideas helped her make
new connections between other ideas. Her naturally inquisitive
mind sought ways to make connections between seemingly oppo-
site ideas, such as technical knowledge and so-called "soft skills."
In the systems thinking approach described in The Fifth Discipline,
Iva saw that Senge seemed to have masterfully crafted that con-
nection, creating a bridge between two worlds that did not effec-
tively speak to one another.
Even more powerful was the possibility of freedom, of honest
dialogue, of being able to speak the truth openly within the walls
146 Part 2 / The Journey

of a business organization. What might we be able to create if such

speech were possible? How much creative potential do we lose by
not being able to have such conversations?
Often, as in Ivas case, our aspirations come from our own
lived experience. Some people know what their aspirations are;
they are close to the surface. For others of us, though, finding our
true aspirations is a long journey in and of itself. When one dis-
covers what one truly believes in, one will have found a wellspring
of creative energy, as Iva did. Then one must begin the difficult
work of managing the effect of that creative energy on others.
The systems that we create can constrain the activities of the
people within them. And, if the systemic forces are not well under-
stood, people can be defeated by the systems within which they
are acting. But the essential thing to remember is that we have cre-
ated these systems and therefore, through sustained effort, we can
also uncreate them and build something better, more life-enhanc-
ing. This is easy to say, but far more difficult to do because it will
require us to unlearn and unlearning is just plain tough. We are
just beginning to come to terms with what learning is. How well
do we know how to unlearn? The theme of unlearning weaves its
way through Ivas story.

Vision as Wellspring of Change

As we discussed in our debriefing of Berts story, Senge says that
most managers have an implicit theory of growth which he calls
the better mousetrap theory. According to that theory, if an
innovation or change initiative is successful, interest will spread;
i.e., our results will speak for themselves. Berts strategy was very
much in line with the better mousetrap theory. Ivas approach to
change also resembled the better mousetrap theory although it
differed significantly from Berts.
Iva believes that her implementation of organizational learn-
ing lacked deliberateness. She wasnt explicit about her theory of
change nor her change strategy. The primary growth engine of her
change strategy was her vision; she was also trying to inculcate in
the organization the capacity for creating shared vision, which is
one of Senges five disciplines.

Iva: We did not have the plant capacity t o compete effectively, yet
we were facing enormous upheaval in our industry. Globalization was
bringing increased competition, and it was like we were involved in a
giant international chess game. I looked a t everything that was happen-
ing and I realized that in order t o become competitive I had t o create a
new vision for the organization.
 Chapter 7 / Debriefing lvas Story 147

Because o f my exposure to organizational learning, I decided that

that new vision would not be created by just me and my staff, it had to
be created by the whole organization. And thats why building the capac-
ity for creating shared vision became an important part o f my strategy.
Thats why I trained people not only in the five disciplines, but also in
Covey.* My philosophy was a variation on FieldofDreurns. My philosophy
was, Expose people t o the ideas and they will come to see the value in
t he m .

Iva relied primarily on her own vision as an engine of

growth-but can vision act as a reinforcing growth process? Vision
is a powerful catalyst, but it must be mutually shared in order for
it to be an effective, self-reinforcing growth process in the same
league with the growth processes that Senge has identified: per-
sonal results, business results, and networks of committed people.
As Iva herself has said, Vision that isnt shared is only a dream.
Unfortunately, the majority of the organization did not share
Ivas vision. This was not so much because they rejected the vision,
but more because they either didnt understand it or they were
threatened by it. But, if the desire to create shared vision was so
strong, why did the vision fail to be shared? We believe that the
answer lies in understanding Ivas strategy. There were at least four
factors that impeded the strategy:
A limited theory of change: Critical reinforcing growth
processes were not put in place and effectively nurtured;
Resistance was underestimated: The challenges were not
anticipated nor handled successfully;
The larger system was not supportively engaged in the trans-
formation; and
The leaders personal transformation was critically linked to
the organizational transformation.

A Limited Theory o f Change

What about other sources of growth? As we discussed previously,
Senge et al. (1333) have described three potential sources of
growth for an organizational change effort: personal results, busi-
ness results, and networks of committed people.3 To some extent
all of these were present, but in a problematic way. For example,
some people began to experience personal results, but this had
unintended consequences. Those who were experiencing personal
results were either starting to feel somewhat distant from the par-
ent company or were being perceived to be somewhat distant. The
perception arose that OL was some kind of cult.
148 Part 2 / The Journey

Second, the link to business results was clear to Iva herself, but
it was long term and not well understood or accepted by many in
the line nor by upper level management. Third, a network of com-
mitted people did begin to evolve, but the majority were staff, not
line people. Increasingly, these people came to see themselves as
vulnerable-as caught between their aspirations and ideals and
the values and behaviors of the larger system. If the capacity for
having shared vision needed to be developed, then what would
sustain the change effort during the time needed to develop the
capacity for vision?

Dea Iing w i t h Resistance

Senge et al. have identified ten common challenges to profound
change which seem to occur over and over. Did the ten challenges
to profound change described in The Dance of Change manifest
themselves in Iva's story? If so, what was her response?

Iva: I absolutely encountered all o f these barriers. I dealt with each

one in my typical fashion, a fashion that I think is typical of executive
management. For example, when I heard "there is no time," I pushed
back. This was too important, I thought, so find the time. Then when I
feared that I pushed too hard, I backed off. I teeter-tottered, trying t o
find the right mix, but I couldn't.

In the early stages, the leader needs to do sufficient work to

ensure that both line and staff understand and see the relevance of
OL. And, if time is a factor, options must be created. If not, we
place people in a "catch-22" where they must either sacrifice
results or sacrifice OL. Neither of these issues were successfully
resolved during the early stages of the PDC change effort.

Iva: When I started pushing members o f my management team hard

for more participation i t was inconsistent behavior. On the one hand I
started with making it really open and free, and suddenly when they
became more free they were told, "You've got to give me your best peo-
ple t o do this."

Relevancy: Dialogue as Dichotomy

Iva unwittingly created a vulnerability by the way in which the five
learning disciplines were implemented. A key assumption is that
all five of the learning disciplines must be engaged for the change
effort to bear fruit. However, during the early stages the PDC
learning effort tended to focus on dialogue and the building of
 Chapter 7 / Debriefing Iva's Story 149

generative conversational skills using such tools as the ladder of

inference and left-hand, right-hand column. The belief was that
these skills were particularly needed to enable the relationship
building that Iva believed was so key to a collaborative environ-
ment. Therefore, some of the five disciplines took root in fertile
soil; others did not.

Iva: In thinking about what theory o f change I applied, I realized that

I did not look a t it from t h a t perspective a t that time. I did n o t make
absolutely sure that the people who were engaged in this work had a full
understanding o f proper balance between all the disciplines and t h a t you
can't get engaged only in dialogue or only in causal loop diagrams,
whichever discipline was dearest t o somebody's heart.

Unfortunately, some began to perceive that dialogue was a

waste of precious time. The perception was that dialogue leads to
reflection and that leads to insight. But the insight was rarely if ever
linked to action. Thus, dialogue seemed to be set in opposition to
action-rather than as a productive complement to action. The
organization was, by its own admission, crisis oriented. Crisis was
the engine for action that gets short-term results. Meanwhile, dia-
logue was seen as a means of suspending action. Unfortunately, the
two cycles did not engage each other, as illustrated in Figure 7.1.

Crisis Dialogue

/ \ f' \

-
Delay1 Action Reflection Insight

t
Short-term
Results

Figure 7.1
Action vs. Reflection

Thus, action and reflection were set up in opposition to each

other, whereas there is much agreement that learning is a cycle
that involves four dimensions including reflection and action as
shown in Figure 7.2.
150 Part 2 / The Journey

Experimentation Reflection Insight

t i i
Conceptualization t Reframing

Figure 7 . 2
The Cycle of Reflection and Learning

Dialogue and other conversational and reflective tools can be

seen as being separate from or even opposed to action, but that is
an unfortunate misunderstanding. In part this may be due to our
reflexive tendency to dichotomize: to think in terms of acting or
reflecting. Of course, we assume that we only have time for one or
the other and that reflection takes too much time.
In actuality, reflective observation is part of how we learn, as
we also see in Figure 7.2. And, as we have already discussed, there
is no learning without taking action. Because our society has
somewhat conditioned us to believe that action is all-important,
dialogue can be introduced as a means for getting us to appreciate
the qualitative change in our thinking that can occur when we are
not just acting and reacting without taking time to reflect. The
problem is that we can forget to link dialogue and other reflective
activities back into action.
From Ivas experience we can learn that OL tools such as
Dialogue must be positioned such that people understand their
purpose within a larger context. They must also be implemented
with the context of Model 11, reinforcing the idea that people
make a free and informed choice to participate.

Organizational learning Tools and Cultural Compatibility

Since Dialogue was too foreign to the organization we again won-
der if there is yet another challenge, the challenge of compati-
bility. Research on innovation diffusion tells us that the successful
adoption and diffusion of an innovation is generally dependent
upon five factors:
1. The perceived Relative Advantage-To what degree is the
innovation perceived as being better than the idea it super-
sedes?
 Chapter 7 / Debriefing lvas Story 151

2. Compatibility-To what degree is the innovation perceived

as being consistent with the existing values (and beliefs),
past experiences, and needs of potential adopters?
3. Complexity-To what degree is the innovation perceived as
relatively difficult to understand and use?
4. Trialability-To what degree can it be experimented with
on a limited basis?
5 . Observability-To what degree are the results of an inno-
vation visible to others?4
Is there a reason to think that OL is immune from meeting the
same criteria that seem to predict the success of other innovations?
The learning effort at PDC illustrates how OL can be rejected if
aspects of it are seen to be too complex to understand or incom-
patible with the existing culture, or if the relative advantage of OL
is not perceived (and embraced) and the results not readily
observable.
Despite the fact that these early challenges-relevancy and
time-were not resolved, the PDC change effort was able to pro-
ceed into the next phase, where it picked up further challenges,
like a racehorse picking up handicaps.

The Dilemma ofAssessment and Measures

Generally, OL change efforts follow a certain trajectory. First, peo-
ple are trained in the five disciplines, then a pilot project starts up
which applies the disciplines. If the pilot demonstrates some suc-
cess, then there is a diffusion attempt. While the pilot is ongoing,
the three challenges of sustaining usually crop up. The first is the
challenge of assessment.
Ivas primary focus was on the long-term viability of the firm
but not at the neglect of the short term. She believed that she
understood the root causes of the companys current inability to
derive a satisfactory return on assets (ROA), and she believed that
she was working on the solution.
While she had worked through her strategy with her first boss,
that agreement did not carry over to her new boss. De facto, she
was proceeding without certainty of his support, but some imped-
iment prevented them from having that necessary conversation.
Then, like most corporations in a highly competitive market, there
was little to no patience for waiting for long-term results, particu-
larly in the face of short-term drops in profit.

h a : I was always interested in integrating OL with the business and

in producing results. The unfortunate thing was that the larger corporate
system and I were viewing the world differently. They had no under-
152 Part 2 / The Journey

standing o f interrelatedness and especially no understanding that cause-

and-effect are separated in space and time, which makes i t very difficult
to connect them. Now, o f course, that's not unique t o Philips.

In the early days of navigation, before there were good, reli-

able marine charts, sailors operated via a technique they called
"dead reckoning,'' a practice still in use today. They calculated or
guessed the course and distance traveled from a previously deter-
mined position. Until we have more detailed maps and more
sophisticated navigational devices, we will have to dead reckon
our way through treacherous organizational waters. We can't do so
alone. Both the evaluators and the evaluatees must collaborate in
determining how they will be measured. This can sound na'ive, for
those who measure can often make the rules to suit them.
However, if we don't make the effort to predetermine and agree on
some measures, we run the risk of getting lost.
For OL to be successful, we must work out ways of assessing
and measuring our learning efforts. This is for the benefit of our-
selves as well as for those who are evaluating us. Even more
important, we must have agreements about our interim and final
milestones. We have to know if we are off-course so that we can
recorrect as soon as possible. What are the progress indicators that
prevent prematurely pulling the plug? Do these progress indica-
tors take into account the fact that things often get worse before
better? Do they consider the fact that our results may differ from,
and thus violate, our institutional memory?

When Fear Shows Up

The discovery of "two camps" on Iva's management team might
illustrate the challenge Senge calls "fear and anxiety." Senge says
that challenge tends to show up when some progress has actually
been made.5 So, in a sense, it is a positive sign. The problem is that
now the real problems are exposed and people become very inse-
cure. They realize that they are on a very different road from that
of the status quo and they want to know how much real commit-
ment they have and how much support they have.

Iva: It was so clear to me that organizational learning made sense

that I took it for granted that others on the management team could see
this as well. I was driving the learning efforts forward because I had such
a strong belief in this work!
If I had known that some on my management team were unclear,
that they really didn't see the value o f OL, or they really didn't feel ready
to make the commitment, I'm certain that I would have slowed down. I
would have spent time with them, inquiring and coaching, until they
 Chapter 7 I Debriefing lva's Story 153

could see it clearly. The problem was that they weren't telling me. They
were agreeing with me on the one hand and then saying, "We don't have
time" on the other. It was classic left-hand, right-hand column stuff.
There was no genuine, shared commitment t o profound change. And I
failed t o see that.
Perhaps I did not want to see. I believed that if this work were to
stop, restarting it would be more time consuming and that the chances
of success would be diminished. I knew there was no magic formula for
making our business more effective. We had to do the hard work of
changing our thinking, and changing the way we went about decision
making, controlling, commanding, planning, and developing. All of the
old rules were not going to work anymore. Of that I was certain.

One interpretation of the discovery of "two camps" on the

PDC management team is that they were reaching the point of
deep commitment. Some on the team perceived the gulf between
the parent company's stance and Iva's vision for PDC. The ques-
tion had to be raised and the fact that it showed up then was as
much a function of how change happens as it was of anything
else. It could be interpreted as a sign of health. The system was
flexing its might; real change was in the offing. The demarcation
between line and staff is currently a weak point in many organi-
zations. The two groups tend to have different priorities and per-
spectives and, unfortunately, Model I theory-in-use makes it diffi-
cult to cross those chasms. So when stress occurs, things tend to
break at the weak point.

Holding Strong Belief Lightly

Yet another challenge to learning efforts is the phenomenon that
Senge et al. have termed "true-believers vs. non-believers. This,
"

too, was present. The staff people who believed in the merits of
organizational learning began to be perceived as a cult by those
who felt like outsiders by comparison. The special terms and lan-
guage of OL became turnoffs. Outside of PDC, Iva's attempts to
spread the word resulted first in an apparent opening, and then in
a more solidified resistance. Without realizing it, Iva was mani-
festing the signs of a true believer. Unwittingly, she was threaten-
ing the system with the strength of her purpose and her vision-
and the system reacted.
Was there a strategy that could have been put in place at that
time to keep the change effort going? Roll0 May once wrote that
there is a curious paradox characteristic of every kind of courage. I t
is the "seeming contradiction that we must be fully committed, but
we must also be aware at the same time that we might possibly be
wrong."G The antidote to the temptation to be a true believer is to
154 Part 2 / T h e Journey

learn to live with this paradox, the paradox of commitment and

doubt. If we can stand there, resistance looks different. Resistance
must be anticipated ahead of time, ameliorated, but also wel-
comed as part of the natural course of events. Resistance is our
teacher.

Engaging the Larger System

As time went on, management of the interface between the larger
system (Philips management) became increasingly problematical.
Attempts to diffuse OL tools and techniques were met with some
initial openness, and then with almost complete resistance. Iva
attempted to seed the governance of Philips with OL concepts, but
in fact, she only succeeded in triggering the preexisting tension
between autonomy and control. In the end, the OL work was per-
ceived as leading PDC to be out of control. Again, the existing
system asserted itself.

Iva: I was perceived as drifting too far from the Mother ship.
Everybody else was organized the same except us. M y boss wanted t o
pull me in and I resisted.

In one sense, Iva seems to have had tried to do too much-

without sufficient support. Using the metaphor of the proverbial
rubber band she seems to have stretched the organization too far
toward the vision and too far away from current reality. Rather
than trying just to engage the larger system and to gain support for
her change effort, she tried to convert the larger system as well. The
resulting tension-both within the local system (PDC) and
between the local system and the larger system-was too great.

h a : All o f this was moving along nicely, but then there was a crisis a t
Philips. They demanded that we stop all travel, etc., so we stopped send-
ing people to be trained in OL. But sometime later we started again. It was
moving in the direction of my vision, which was that you have t o give
people the skills, you have t o give them tools, you have to go slowly.
You have to get the operating people involved because if you only
get staff people, nothings going t o happen. But that set up a crucial
conundrum: How could I get the factory people involved? They were
caught between a rock and a hard place. We had a great position in the
market. Our customers wanted more, but the factory didnt have the
capacity to meet demand. So we drove people into the ground to make
more tubes and then we had a strike. And thats when everything began
to fall apart.
 Chapter 7 / Debriefing lva's Story 155

Iva was very much invested in stirring the creative energies of

the firm through alignment around a purpose The early work in
developing a company credo shows her foresight. But, again,
thinking "outside the box" seems to have stretched the tolerance
of the organization.

Iva: Looking back, I can see that I was always trying t o fulfill what I
saw as a strategy and vision deficit in Philips. M y concern was that
Philips was continuously behind in developing a strategy for the busi-
ness. For example, we were the first to say, "You're going to have t o build
tubes larger than 27 inches because of this market." But upper manage-
ment said, "No." Then our competitors did it and took 90 percent of the
market in the US. Then we came into that market, but five years later.
We were too late. Perhaps the European management couldn't accept a
vision coming from the US.

Unfortunately, in committing herself to the long term, short-

term results were not forthcoming in terms the parent company
could understand, and Iva was vulnerable. As a consequence,
resistance was mounting within and rejection was mounting at
European HQ. Without clear results to point to-and some nega-
tive impacts apparently in evidence-time ran out. In a sense, the
larger system had no "choice" but to respond in a rejecting man-
ner. As Senge reminds us, although these systemic reactions come
at us in the form of individuals, these forces are not personal.
Despite our tendency to react personally to these perceived
"attacks" or strong resistance, there is power in our developing the
ability to see these very individual acts as merely the manifesta-
tions of the system attempting to preserve itself. And we must also
see ourselves as a force attempting to throw the system out of
equilibrium.7 From this perspective we can see that if we are to
lead change successfully, we must understand how to work artfully
with these systemic forces.
There are several opportunities to reflect, inquire, and learn
here: we can reflect upon our own approach to engagement and
also upon scope. How much can and should we take on? Are we
attempting to "boil the ocean?" Are we too set on convincing peo-
ple that we know what's best for them? Are we forgetting to man-
age to the requirements of the old system while trying to drag it,
single-handedly, kicking and screaming into the future? Could Iva
have negotiated the safety to engage with OL as a corporate-spon-
sored experiment?
156 Part 2 / The Journey

PersonaI Transformation and Organizationa I

Change: A Crucial Link
In Ivas story, the quest for personal transformation and organiza-
tional transformation are much more intertwined than in Berts
story. Iva embraced the notion of personal change. She saw great
opportunities for personal growth in the OL techniques and she
embraced them wholeheartedly.

Iva: I was very committed t o Dialogue, and my involvement with i t

tended to surface some critical new learnings for me about myself as a
person and my leadership style.

Through her work with Dialogue (in particular, with her man-
agement team), Iva was beginning to understand the dynamics
that led to the fear-based reactions and behaviors that are so
intrinsic to Model I. Unfortunately, she was doing this learning
without sufficient understanding of, or support for, the transfor-
mation required to learn and create Model 11.

Iva: Early on when I became president I asked for and got a lot o f
feedback on my management style. I was listening to that feedback and
thats why I started to change the way I acted. I learned that I was per-
ceived as being quite aggressive-but, ironically, that was not how I saw
myself. I saw myself as being quite fearful. And when Im scared I dont
run away. I go after what I want even more. This came from the back-
ground that I grew up in. In Yugoslavia a t that time, if youre scared,
youre dead. I learned that nothing good comes out of fear. So I learned
to act very aggressively when I was in fear.

While her personal learning deepened, many in PDC were in

a watchful and wary mode. Having been sold and having endured
several downsizings, as well as being used to command-and-con-
trol management, many people in Ivas organization took their
cues from their leader. Because they also lacked an understanding
of the transformation process, they were often confused by what
seemed like contradictory behavior on the part of the leader.
Iva recognized the interdependency between her personal
transition and that of the organization. She had had to undertake
a heroic journey in order to make it to where she was. The suc-
cess that comes with hero-leadership is a double-edged sword. On
the positive side, hero-leaders come to value their ability to force-
fully bring about their ideas; they feel masterful. On the negative
side, they may become less able to read subtle signals or to work
with the intangible forces of systemic change. We believe that
most traditional and heroic command-and-control leaders will,
 Chapter 7 / Debriefing Ivas Story 157

by definition, have a hard time making the transition into being a

leader of OL efforts.

Iva: I began to realize that in order t o build an organization that was

capable o f learning, I would have to become a different kind of leader.
And I wanted to be a different kind of leader. I was not happy with how I
was perceived. I did not want t o be a leader who instilled confidence and
fear simultaneously, who was simultaneously loved and feared, but a
leader who would enable building o f an environment in which people
would be able to create what they truly desire.
I was very much a work-in-progress at the time, but I was making a
deliberate effort to change and to become a more participatory, enlight-
ened leader. As we all know, its easy to talk, but much harder to walk the
talk, and even more difficult to help others walk their talk. But we started
slowly making progress.

Senges view is that organizational transformation begins with

change on the personal level. The one is not possible without the
other. Argyriss theoretical framework explains in more detail how
and why this link is so critical. As people learn Model 11, Argyris
believes that they will necessarily create a learning system that
then feeds back to reinforce their new Model I1 theory-in-use. In
other words, the process of individual and organizational transforma-
tion occurs simultaneously and it is self-reinforcing. The transforma-
tion of the organizations learning system (from one based in
Model I to one based in Model 11) cannot occur without the trans-
formation of individuals from Model I to Model 11; likewise, indi-
vidual transformation will be impeded unless the organizations
learning system also transforms. The change processes are interde-
pendent.8
Iva was deeply convinced of the potential of OL. She was so
convinced that she felt it was her duty to try to convince others.
Because the organization was taking its clues from Iva, it was very
important that she walk the talk. But for any leader schooled in
command-and-control, this style change is not immediately
achievable. Even when there was evidence of commitment, Iva
tended to be out ahead of the pack, the lonely leader at the top.
The leader who is engaging in this type of change must enlist
help. He or she must be willing to ask for and receive immediate
feedback on how well their actions are reflecting their espoused
beliefs. Iva lacked consistent and sophisticated help in this area.
She relied on sporadic feedback, so it wasnt clear to the organiza-
tion that she was actively seeking feedback and that it was making
a difference. But the responsibility does not only lie with the
leader. In turn, people in the organization must learn to provide
158 Part 2 / The Journey

feedback and also allow for a learning curve-but they can't

unless they are explicitly asked to do so.
Iva faced particular challenges here in that her personality is
charismatic and forceful and because she had learned throughout
her life to push through obstacles. Here, finally, was something
different. Here was a life lesson of profound portent. Here was the
opportunity to understand the true nature of resistance, to see it as
a systemic property. Here was a chance for Iva to rethink every-
thing upon which she had built her life. She took that chance, but
not without a lot of resistance of her own.

Iva: It's interesting for me to reflect on this now. I see that I was pri-
marily relying on my ability t o move things forward because that's what
I did all my life. But a t the same time I was keenly aware that I couldn't
push OL because this is a different kind o f work. So I was teeter-totter-
ing between the two positions of taking charge and doing it, and just let-
ting it emerge.
I was able to see the change effort as a system, but I was not able
to guide my actions accordingly. I see now that my tendency was to push
on the levers on the reinforcing loop-to be even stronger in my vision
and my conviction-rather than paying sufficient attention to the bal-
ancing loops.
I knew the balancing loops were there, but I had only a conceptual
understanding of them, not a practical sense o f how to use them. M y
management training worked against me. I didn't give us a chance t o
work through the inevitable time delays. I could have also seen that
resistance could have been seen as a balancing loop, but instead of
inquiring into the reasons for the resistance I continued t o try t o con-
vince people that this was a good pathway. Rather than exploring or
deepening my understanding of the assumptions held by people who
resisted, I pushed on.

Building a Bridge Between Two Systems

Iva was, indeed, gifted with a vision of what could be. But vision,
like pragmatism, is both a strength and a weakness. Iva was driven
to attempt much: she tried to engage deep organizational learning
within the context of a Model I learning system without fully
understanding the enormity of what she was attempting or antic-
ipating the resistance she was likely to encounter. She tried to
build an infrastructure that would support learning while simul-
taneously trying to get a handle on the basics. She also tried to
 Chapter 7 / Debriefing lva's Story 159

convert others to her vision more than she tried to inquire into
and honor the beliefs and concerns of others.
Iva believed that the future viability of the organization lay in
transforming the current conditions to a new set of conditions.
These conditions are summarized in Table 7.1.
Table 7.1
Current Reality and Vision

-
Current Reality Vision

Hierarchical, command-and-control Participatory climate where

.
environment we cocreate
Lack of trust Trusting environment where
we support each other3 learning

. .
and growth
Resentful compliance Free and informed choice;
clarity about what we want to

. .
create
Favoring logic at expense of feelings Balance between logic and

.
feelings
Tendency to conform and be Appreciation of diversity;
fearful of difference people can be authentic and
express who they really are

Using Argyris's framework, we believe that Iva saw the possi-

bility-and the perceived necessity-of moving the organization
in the direction of Model 11. She had a strong implicit commit-
ment to Model I1 theory-in-use, and her espoused values were in
line with it. In essence, Model I values are fear-based and self-pro-
tective; they tend to surface in situations of potential threat or
embarrassment. This is why we have a tendency to revert to Model
I while we are learning Model 11.
Argyris has also written that the tendency to operate according
to Model I values tends to be universal and is rooted in our
upbringing. Therefore, it is difficult to shed or even discern the
#existenceof Model I unless we are taught to do so. We can say,
then, that Model I is shaped by a worldview-a worldview that is
fearful. Out of the research in physics and other sources, an alter-
native worldview seems to be arising that challenges the world-
view that shaped Model I.
The contrast between the dominant Industrial Age worldview
and the alternative worldview that is unfolding is represented in
Table 7.2.
160 Part 2 / The Journey

Table 7.2
Contrasting Worldiews

Industrial Age Worldview Emergent Worldview

.
.
Mechanical system Living system
Parts are separate and have only Parts are intrinsically related to
a mechanical relationship whole and vice versa

. .
to each other
The assumption of linear cause- Non-linear causality

- and-effect relationships
Reductionistic thinking
Dichotomous thinking, which makes
. Holistic thinking
Interconnection and
reconciliation of apparent opposites interdependence
difficult

If we accept this characterization, then we might see these two

learning systems, Model I and Model 11, as embedded within two
contrasting worldviews. The worldviews are themselves systems,
though of a much larger nature. They are equally self-reinforcing,
If we accept this characterization, then yet another challenge
emerges. The challenge is for those who believe in the efficacy of
Model I1 and who likewise share a belief in the efficacy of the
emerging worldview. The challenge is twofold:
1. To articulate a clear pathway to the new system, while
2. simultaneously honoring the old system.
Because of our tendency to dichotomize (encouraged by our
prevailing worldview), our seemingly "natural" tendency will be
to set these two worldviews in opposition to one another. This
tendency tends to create the true believer and the perception of OL
as a cult. What is needed instead of revolutionary thinking is the
thoughtful cocreative, skillful creation of a bridge or pathway to
the new worldview.
The bridge between Model I and Model I1 learning systems is
relatively well-delineated. This is partly because Argyris does not
ask that people abandon their tendencies toward attribution and
evaluation; he only asks that they make the reasoning behind those
attributions and evaluations transparent so that they can be open-
ly challenged and tested. The same kind of bridge-building needs
to occur between these two worldviews. It is possible that the
building blocks for the bridge can be found in those things that
these two hold in common.
When we focus on the differences between the two spheres
(versus the bridging elements) we make it harder to articulate the
 Chapter 7 / Debriefing lvas Story 161

connections between the two. Ironically, we make the chasm

wider and therefore harder for people to walk across.

Berts journey spoke to us about values and pragmatism. Ivas

journey reminds us of the power of vision and conviction, but
reminds us to temper that conviction with flexibility in strategy
and tactics. It also emphasizes the importance of inquiry and of
gaining consensus around the perceptions of current reality, the
possible vision, and the pathway between the two. It also leaves us
with some questions about the role of the leader.
In the next chapter, Bert and Iva engage in double-loop learn-
ing, reflecting on the assumptions that led them to make the deci-
sions they made in the course of their journeys.

Endnotes

1. Chris Argyris, On Organizational Learning (Malden, MA:

Blackwell Publishers, 1333), p. 181.
2. Stephen Covey, Principle-Centered Leadership (New York:
Simon & Schuster, 1331).
3. Peter Senge et al., Dance of Change: The Challenges of Sustaining
Momentum in Learning Organizations (New York: Doubleday,
1333), pp. 42-57
4. Everett Rogers, Diffusion of Innovations (New York: Free Press,
1335).
5. Senge et al., 1333, op. cit., pp. 241-247.
G. Roll0 May, The Courage to Create (New York: W.W. Norton,
1375), p. 20.
7 . Senge et al., 1333, op. cit. To further understand these systemic
forces and the necessary interplay between them, see Ralph D.
Stacey, Complexity and Creativity in Organizations (San
Francisco: Berrett-Koehler, 1336).
8. Robert Louis Flood, Rethinking the Fifih Discipline: Learning
Within the Unknowable (London: Rutledge, 1333).
Chapter 8
The Double Loop:
What Have We Learned?

In the debriefing chapters we explored and analyzed some of the

key aspects of Bert and Ivas strategies. However, an objective
analysis is never sufficient for an assessment of a learning effort
because such an assessment tends to corroborate Model I theory-
in-use. When someone stands outside someone elses experience
and evaluates it, they tend to make attributions and judgments.
The reasoning behind these evaluations is generally not revealed
nor is it open to question. Therefore, this type of assessment does
not necessarily engender further learning, particularly on the part
of those involved. It is our belief that the most important learning
occurs when people can reflect together upon their own and each
others actions, develop insights into their patterns and behaviors,
and then make adjustments in their actions based on that refram-
ing, observing and reflecting upon the result. This is double-loop
learning and most often it requires some assistance from someone
skilled in the reflective learning process.
In this chapter, Bert and Iva attempt to model this double-
loop learning process. They will examine the assumptions that
they held during their change efforts. Ideally, double-loop learn-
ing that happens at an individual and team level would translate
into learning at the organizational level, i.e., people in the organi-
zation would design their actions based on a revised set of
assumptions. This cannot be the case here. Still, we are privileged
to listen in, observe what this might be like for us, and imagine
how we might do this type of reflection ourselves, in real-time.

163
164 Part 2 / T h e Journey

Iva: Bert, do you think that your experience with OL was a success
or a failure?
Bert: Well, as much as I would like t o claim that it was a success, I
think that it was something in between. I changed some procedures and
changed some people's lives for the better and in that sense, it worked.
On a personal level, I think I learned from my mistakes. But a t the orga-
nizational level, I didn't get people in influential places to adopt organi-
zational learning per se. Nor was I able to find a way t o diffuse the learn-
ings that came out of our efforts. I made solid relationships with some
unexpected people in the union, but I did not get critical mass a t the bot-
tom and I didn't get it at the top either. My motto has always been "leave
it better than you found it," and I don't believe I left it better than I found
it in any meaningful way.
Iva: Because there was no lasting change?
Bert: There was no lasting change. I don't think that there was a
turning point a t my company because I did OL.
Iva: I feel similarly. I believe that this work did have a positive impact
on many individuals. However, I also think that some people were hurt.
Now, of course, there doesn't appear to be a trace of it a t PDC and it's
not clear how much it permeated the larger system.
Bert: The question is: What can we learn from our experiences that
might be useful to others?
h a : In the spirit o f double-loop learning, I'd like us t o look a t what
some of our key assumptions were when we started out. Let's see if they
need to change.
Bert: I ' l l do it, but I'm a little apprehensive. I don't like exposing my
misperceptions-which, of course, is exactly what double-loop learning is
all about.
Iva: That's precisely why we need t o do it. The double-loop learning
process is the antithesis o f management as we know it. When you're in
management you're expected to have all the answers. You have t o be
ahead of everyone else. You can't be open about your mistakes.
Bert: And, of course, if you know the answers, there's no reason to
learn. That's a perfect example of a closed system.

The Road Divides

Iva: 1'11 start by saying that I have learned a great deal as I progressed
on my leadership journey. I developed a deep longing to bring more of my
personal values into the leadership of my organization, but I also discovered
that that was harder than I thought because, in many ways, I had lost touch
with myself. Something had happened on the road to upper management
that shifted me away from being aligned at the core of my being.
Bert: Like you, I had these strong values. But I felt that I had t o put
them on hold for a long time. I believed that I couldn't quite implement
 Chapter 8 / T h e Double Loop: What Have We Learned? 165

them because o f the realities of the business, but I always thought,

"There's got to be another way." Organizational learning seemed to pro-
vide the way to bring those values back into the business.
h a : For me, too, but that's also where the road divides. You pro-
ceeded in a very cautious way whereas I didn't. I was very committed to
getting others to experience what I had experienced and t o seeing the
merit o f organizational learning. I think that's because when I got
involved with the Organizational Learning Center at MIT we started talk-
ing about things that I had been feeling and thinking all my life but had
never expressed in the work environment, and I began realizing the
importance of them.
So, as president, I tried to transform the organization I led and I also
tried t o bring these new ideas to the rest o f the company. I became the
proverbial boss who goes to a course and comes back "talking funny."
Then, later, I became the Senior VP o f Manufacturing Technology for the
American (US.) Region. The job was located in US. corporate headquar-
ters and that environment seemed as if it came from a previous century.
The command-and-control management style permeated the entire
environment, from the layout of the executive suites to the furniture, t o
dress codes, to everything. I tried t o proselytize my ideas to the rest of
the company. I began talking about organizational learning. Do you think
they listened? Hah!
Bert: In the beginning I was also very excited and very gung ho
about the potential for organizational learning in my company. I thought
I had found the answer to a lot of the problems that the company was
facing. I tried to bring that enthusiasm back to my company, but for
some reason it didn't translate well and in the early stages I began to
worry about why this organizational learning stuff wasn't taking hold. I
used to walk around and say to myself, "Why don't they see this?" I
began to think that I had done something wrong, or that I wasn't a good
enough change agent. I thought the problem was with me.
I found out that you can really drive yourself into an absolute frenzy
about your lack o f capabilities as a change agent because you think if
you've been successful all your life a t solving business problems, this is
just another one o f the problems. I'm an engineer, and engineers are like
that, thinking they can solve anything. But being an agent of this kind o f
change is another thing entirely.
Iva: When I talked about my new view of the world with people in
the company I went so far as to say that we will eventually eliminate
hierarchies as they are seen today. I had a metaphor that I used: an orga-
nization is like a slinky. It moves very rapidly in different directions. It has
a continuously changing and evolving shape with tremendous flexibility.
And then I talked about the organization as being a spiral instead of a
pyramid. You can be on the same side of the spiral and have more influ-
ence, depending on what side you're going to. I could see i t so clearly!
166 Part 2 / The Journey

But I learned that others weren't able to see it. Or they were afraid of it.
Or I just wasn't clear. Later, I learned that as a leader o f organizational
learning I have to take more responsibility for my communication. I need
to ensure that people understand the intention behind my communica-
tions because it appears that many times they misunderstood and I was
unaware of it.
Bert: The failure o f that first project told me that my approach to
changing the organization wasn't working. That caused me to rethink my
strategy. After that, I switched gears and I got very pragmatic. I knew I
needed a very practical platform from which to introduce new ideas
because when we tried t o introduce quality into our organization people
didn't have time for it because they didn't perceive it as real work. They
had their "real job" t o do so they couldn't go to the Quality Improvement
meetings. I always found this very exasperating, but that's the way it was
perceived.
I began to think that those of us running the Quality meetings had
created those perceptions ourselves because the kinds of problems we
gave people to solve were affectionately known as "moving the water
cooler around." Basically, they were meaningless in terms o f people's real
day-to-day jobs. So TQM got a bad rap. I tried to use my learning from
that and not make the same mistake when I began introducing systems
thinking. So I made other mistakes instead.

Working with Culture

h a : One of the things I did was underestimate the importance of cul-
ture. Looking back l can see that l didn't really understand how to work
within the culture of my organization. I tried to change the culture and cre-
ate a new culture.
I believed that I understood the culture o f the factory, but I did not
do a formal cultural assessment. Then I tried t o change the factory cul-
ture and make it more like the culture in the headquarters by bringing in
organizational learning, but I failed t o understand that the employees in
the factory really did not appreciate things that came from outside.
Bert: So you had t w o assumptions: You assumed that you under-
stood the factory culture and you also assumed that you knew how t o
change it.
Iva: Not only that, I assumed that the culture needed to change and
that it needed to be homogenous. Those were critical assumptions and I
did not inquire into them a t all.'
Bert: One of the things I assumed from the beginning is that the cul-
ture o f a company is like a slingshot. It can only stretch so far before i t
snaps back-and when it snaps back you can really get hurt. To go into it
with the idea that you're going to change the culture is to encourage
what I call the "biological rejection phenomenon." Like a slingshot, if you
 Chapter 8 / T h e Double Loop: What Have We Learned? 167

create too much tension in trying t o change it, the culture will try to
restore itself. Therefore, you have to use the culture in order to change the
culture.2 In other words, you have to use what people in the culture cur-
rently value, like results, as a platform for initiating new ideas and in this
way pull them along to a new approach.
Iva: I see what you're saying, but I wonder about it. You can't pull
anyone along. A change in culture happens only through learning so I
agree that you have to start with understanding the culture to see what
people value and are willing and capable to change-but then you have
to help them learn.
Bert: M y belief is that you have to move incrementally, by staying
below the "alert" level. Ideally you work with people in such a way that
they get an "Aha!" and they think it's their idea. That's what I tried t o do,
whereas I think you were too visionary in your approach. The role o f the
leader is to create the path between the vision and the current reality.
The leader has to create the mechanisms that enable the organization to
adapt to change while not foregoing the issue of management. The role
o f the leader is not to be a revolutionary but t o reform. You were more
on the revolutionary path.
h a : So the answer is t o be more pragmatic?
Bert: Yes. The more we believe in something the closer we get to
being zealots, and therefore we are less likely to see the pitfalls. I think
that happened in your case. I proceeded more cautiously than you did-
but maybe too cautiously, as I think back. Our biggest strength is fre-
quently our biggest weakness. The one thing I'm still sure o f was that I
had to play the financial game. I knew I had to deliver my financial
results while making these changes happen.
Iva: I was very conscious o f financial results, also, but I believed that
there were systemic reasons why our results were lagging behind, such
as lack of capital, outdated processes, and a culture that was resistant to
change. I was trying t o work on those systemic reasons but I failed to
create the conditions with my new boss so that he was in support of my
efforts. Without that, we were a t risk. Instead, I assumed that I could
hold him off until I created the results, then he would see that I was
right. That was a huge assumption on my part. I see now that I should
have inquired into his reasoning and tried to see the situation from his
point of view but a t the time I was not far enough along in developing
my capacity t o act in accordance with Model II.
Bert: We both struggled with the fine points of strategy. I found that
I was lacking in strategizing skills. I believed in using the culture t o
change the culture, but I didn't know much more about how to go from
A to B-l sort of went by gut. Sometimes i t would just click. I would do
things sometimes on the spur of the moment. I had a catch phrase that
I always used, "1'11 make the decisions and deal with the consequences."
Iva: What do you think about that now?
168 Part 2 / The Journey

Bert: I don't think it was the most effective way. Although I made a
lot of friends with this approach, I also made a lot o f enemies.
Iva: So maybe you had an underlying assumption that got in the
way?
Bert: I was a hands-on person, a construction guy. Everybody knew I
was a technician from construction. That was an advantage in our cul-
ture. If l stood up and said something in a meeting everybody listened
because they believed that I knew what I was talking about. Me, too. I
used t o think, "I came from the ranks so I know what's what." As long as
I was in my element, I knew my element. After my first project attempt
failed I found out very quickly that I had better learn more about what
works and what doesn't work in terms of a change strategy. Now sud-
denly I was not so much the expert. I was also very concerned about
dealing with people who had power and who also had different opinions.
That was a big challenge for me and, as a result, I started going on a
Iea r n ing j o u rney.
Iva: This is the exact same experience I had. I knew picture tubes in-
and-out. I was the expert. I sat on a global management team with a
whole bunch o f guys who knew less than I did about picture tubes so
when I spoke about picture tubes and processes, everyone listened. But
then, when I started talking about organizational learning, that was the
end of my influence.
Bert: How do you speak with expertise about something that by def-
inition you're just learning about?You're on a journey and you don't have
definitive answers-
Iva: In most business environments your position is based on your
expertise. You have t o know the answers. If your answers are right, then
you deserve t o be where you are. But i f you suddenly start talking about
learning, everyone starts t o ask, "What happened to you? Who needs you
if you have to learn?"
Bert: So, I was no longer the expert. Then I realized that I had to
learn how to anticipate things more. My natural tendency was t o react
and to make the decisions and then deal with the consequences. I needed
to be much more o f a reflective person. It was devastating to me when
my first project failed. It just blew me out o f the water. I couldn't deal
with the consequences. It hit me harder than I thought it would.
Iva: So, you were in this cycle of making a decision and dealing with
the consequences later. Was there an underlying assumption?
Bert: The assumption was that I wouldn't make mistakes very often!
That comes out o f a little bit of cockiness and self-assuredness. But I was
doing OL and slowly realizing that I don't have a very efficient way o f
learning myself. I didn't do much double-loop learning while I was in the
middle of things.
 Chapter 8 / The Double Loop: What Have We Learned? 169

Iva: Well, I can relate to that. I, too, am very action-oriented. I can

push very well for what I want. And instead of reflecting when I come up
against an obstacle, I tend to push harder.
Therefore, my number one learning with regard to strategy is:
Understand the origin and construction of the balancing loops. This is
especially important for leaders, like myself, who have been successful by
pushing on the reinforcing loop. Most leaders know how t o do that very
well, particularly leaders in my age group.
Bert: Is there a double-loop learning for you?
Iva: All through my life my deepest assumption has always been that
success comes through effort. I have always had t o push for what I want.
That has been a very successful strategy, but now I have learned that that
strategy can sometimes backfire.
The skill I need to develop is t o be able to see the systemic structure
that is operating in the moment. If I can stop myself from jumping into
my old pattern and see the situation from a systemic point o f view, then
I will know when it is time t o stop pushing and deal with the balancing
process by removing barriers. I know intellectually that if you minimize
the effects of the balancing process, the total result would go up proba-
bly more than if you continue pushing on the reinforcing loop, but it is
hard for me t o think that way in the moment. It's much easier for me t o
jump into pushing.
Bert: I also feel that I didn't do a good job of anticipating conse-
quences and barriers. I let the ten challenges Senge describes come up
and then walked right into them.3 I would almost call that incomplete
thin king.
Iva: I did the same. Often, I didn't even recognize that the challenges
had come up. What is the assumption operating there?
Bert: I was working in a just-in-time mode. I assumed that I didn't
have to think about these things ahead o f time and I also assumed that
I'd be able to deal with whatever showed up. But I found that I failed t o
apply some o f the things I know. I mean, I knew them but I didn't apply
them when I needed to.
Iva: You had the knowledge and you had the experience. I just won-
dered what got in the way o f putting them together?
Bert: Oh, I think I know exactly: a personal deficiency when it comes
t o rejection. I felt rejected.
h a : So you saw it as rejection-instead of, o f course, here's the bar-
rier, here it comes-
Bert: I see those things as fiascoes. I use that word because I blew
it. Failure is one thing. Failure is when something doesn't go the way you
planned. A fiasco is much worse.
Iva: So you don't like t o fail.
170 Part 2 /The Journey

Bert: Not at all. I evolved to having patience with both myself and
the change process, but I didn't start there-I learned it through pain. My
first inclination was to beat myself up. I kept saying to myself, "Why
don't they see it?" Oh, I was very frustrated. I just couldn't put the t w o
ends together. I was stuck because I have these strong opinions about the
bottom line and the financial aspect o f things. I am almost married to
that. And then I see the other side and I recognize that the t w o of them
could actually be very harmonious, but I don't know how t o put them
together easily because it takes time and I'm a Type A personality.4 I get
very frustrated.
Later on I evolved to the "field of dreams" idea. I wanted to get accep-
tance for what I was trying to institute. So in order to speed up the tim-
ing my tendency was to move the tension the other way, move it closer
to current rea Iity-
Iva: Whereas I kept creating more tension both for myself and for
everyone else by emphasizing the gap between current reality and the
vision, and constantly stretching toward the vision.
Bert: In contrast, I thought I was pretty astute to negotiate for air
cover. My air cover would be like the proverbial "canary in the mine" and
that feedback would help me modulate my pacing and timing. I didn't
trust myself to be sensitive enough to perceive how the organization was
responding so I was going t o use my air cover t o help me. In that way I
thought I could balance action and nonaction.
h a : You found an external monitor since you couldn't do it yourself.
I didn't even seek air cover because I was a heroic leader. I had to be in
front of the troops. I had to take the bullets. I had t o be up in front and
I had t o protect them. I created the air cover for other people.
Bert: Well, I am still very much into the hero thing. I think OL takes a
leader who provides the environment that's necessary, who's associated
with it, who's in the right position. Absent that, upper management
could stop it in an instant.
Iva: I think that the sustainability of a learning effort requires more
than heroic leadership; it requires critical mass. It's tough to sustain
organizational learning if the interest is just at the top or just at the bot-
tom. The critical factor isn't necessarily the percentage o f people
involved, but rather the importance o f the projects where OL is used. It
has to be strategically placed within the organization and that's going to
be different for every organization.
And then, of course, it requires the leader to manage upwards. I didn't
do that well enough. Do you think that maybe you could have gotten
your upper management to buy in?
Bert: Oh, absolutely. My problem was that I didn't do a lot o f mis-
sionary work. I didn't do anything to reconcile, mitigate, or include resis-
tance. When I met with resistance I would stop and evaluate whether i t
was absolutely essential for me to deal with it. But the truth o f the mat-
 Chapter 8 / The Double Loop: What Have We Learned? 171

ter is that I did not spend a lot of time and effort trying to engage peo-
ple or trying to understand the rhythm of things. I just said, "Well OK,
under condition A, go to solution B."
Iva: Very linear thinking.
Bert: Oh, very linear. I justified it in my own mind by saying I just
wasn't going to play the political games. In retrospect, I should have
spent a lot more time in conversation. For a long time, I did not value
Dialogue very much.
h a : And by extension, conversation?
Bert: Well, hopefully not that far, but I didn't have a lot o f patience
with conversations that didn't have an intended outcome. If a conversa-
tion looked real open-ended, I called that "fluff and stuff."
Iva: I wonder i f you feel that way because we in management have
a tendency t o overcorrect? For example, we spend the majority of our
time in meetings trying to define outcomes that get us the results we
want. Then we take some time out and go get some management train-
ing. Through that training we realize that we might not be getting the
results we want because we don't know how to really talk with each
other any more. So we start to practice holding conversations where we
don't look for immediate outcomes. Maybe we do this in such a way that
it becomes an overcorrection-and, as a result, people like you don't see
the value and they get turned off.

learning and leadership

Iva: I've come to the conclusion that the sustainability of a learning
effort also has a lot to do with the leader's capacity for learning. The leader
has to continuously learn. That means you have to continuously reflect,
which says you have to be open to the fact that you don't always know
what to do. You have to be willing to admit to your own mistakes. Once you
recognize and reflect on them you will learn.
Bert: That's a good point. And tough for me because I'm not a reflec-
tive person by nature. I didn't do a lot o f double-loop learning along the
way.
h a : That connects to my second key learning, which is that to be
able to do all o f the above, leaders need t o have personal mastery (one
o f Senge's five disciplines). It's very nice t o say, "We're going t o do all
this. We're going to learn t o trust," and use all these beautiful words, but
as leaders we have to be able to live according t o our words. Leaders
need to have the capacity for reflection and they need t o be able to
attend to feedback of all kinds.
Very often I didn't see the assumptions that underlay my thinking. In
fact, I did the typical thing that so many managers do. I saw only those
things that I wanted to see, the things that affirmed my beliefs. It goes
without saying that I did not have this insight while I was in the midst
172 Part 2 / T h e Journey

of things. That realization only occurred upon reflection, and much later.
Eventually I discovered that my approach-this evangelistic approach-
was not successful. But it took me a long time to realize that.
Bert: In the beginning I did not put a lot of value on personal mas-
tery. I thought that the concept o f "situational leadership" was more
important. I thought it was sufficient to describe the kind of leader that
was needed. To me situational leadership meant that the leader had the
ability t o be the right person at the right time. It's not only about having
the knowledge, it's also having the ability t o be attuned t o the specifics
of the situation: t o do the right thing a t the right time at the right place.
Doing the right thing but not a t the right time and place is bad. Being in
the right time and the right place but not knowing what to do-that's not
so useful either.
Iva: I don't think the term "situational leadership" is sufficient t o
capture all of what's needed in an OL leader.
Bert: In the last couple of months my thinking has shifted. I still
believe that you need to attune your leadership t o the situation, but I
don't think you can be a good situational leader unless you know what
to draw upon. For example, I need t o learn how t o be more sensitive t o
pacing and timing. I was very good at pacing and timing in the old world,
but in the new world, different rules apply. The signals you get mean dif-
ferent things.

Living in and Between Two Worlds

Iva: It almost seems as if in order to be leaders who will lead organiza-
tions with OL in mind, we have to live in two worlds-two systems-simul-
taneously. We have to live in the system that we have emerged from-com-
mand-and-control, mechanical, hierarchical-and the one we are being led
into which is based on the principles of OL. We have to live in the business
world of today. We also have to live in a new reality at the same time that
we are trying to create it.
Bert: That's the way it seems, but I have never experienced t w o
systems living harmoniously. When I met the Japanese guy a t MIT he
talked a lot about harmony whereas I often said, "I just don't see how
it's possible."
Iva: So you have an underlying assumption that harmony is not pos-
sible. Maybe you have to change your view of what "harmony" means.
Being in harmony does not mean coming to peace with something and
putting it behind you. Harmony is dynamic. Believing that harmony is
possible gives us the courage t o find out more.
Bert: I did a much better job networking downwards than I ever did
upwards or sideways. The reason was that, a t the time, I did not really
believe that having harmony between systems of traditional command-
and-control and an organization based on learning was possible. That
 Chapter 8 / The Double Loop: What Have We Learned? 173

was my assumption. I can see now that that was a powerful assumption
because I also believe that 01 leaders have t o have the strength o f their
convictions. The skill is t o articulate the value of OL and link it to what
the people in the corporation value. The other skill is being able to talk
passionately and effectively about the value of organizational learning
without coming across as being phony or mushy-and to do that equally
well with both employees and higher management.
Iva: But for me, understanding what's needed to be a leader o f learn-
ing is less a matter of defining the skills-though I think they are impor-
tant-than o f delineating some sort of transition path from traditional
command-and-control leader t o this new way of being.
For example, I know that I was trying very, very hard t o model this
new way of being, but I had a hell o f a time. I was the consummate CEO-
type who turned the company around. Remember there was a
Businessweek article that talked about me slashing this and slashing
that, and what a great "slasher" I was.5 Then I realized that there was
another part of me that was much more important. I was dedicated to
creating a better workplace, but that was out o f line with the expecta-
tions and the vision o f those above me! Even those below me couldn't
believe a t first that I was trying t o change.
There were quite a few times when I slipped back into my old com-
mand-and-control behaviors. I know this confused people in my organi-
zation. When you as the leader try to do things very differently, some-
times people don't observe it. Sometimes they don't believe what they
are seeing. They are confused at first and they don't trust you because
they don't trust their own observations. They think, "It can't be! She was
a command-and-control leader yesterday and now she's this servant
leader?" That was very hard. They had a picture of what the president
ought t o be. They might not like it, but that was what they expected. Yet,
the way I was characterized was not the way I wanted t o be character-
ized anymore. That was not who I was-even though I had to be that way
to get to where I was. And that old picture of me that the people in the
organization had-that old mental model of what they expected their
leader to be-that turned out to be a tremendous obstacle. More so than
I had ever expected.
Bert: That was a challenge for me, too. I've since learned that peo-
ple thought of me as a "Theory X manager trying t o be Theory Y.'I6 That
really stuck with me because I think it's true. Then I think that I tended
to overcompensate for my Theory X tendencies by staying with people
too long when perhaps I should have told them that they were not per-
forming up to my expectations. M y decision making sometimes wasn't
consistent.
Iva: There were times when the management above me expected-
and wanted-me t o exhibit those old command-and-control behaviors.
When I didn't they were also confused.
174 Part 2 / The Journey

Bert: So why is it that we struggled so much with the transition?

h a : I think that many of our readers will also struggle with this tran-
sition. We may only have a vague, intellectual understanding of what OL
leadership entails. Also, we have been so conditioned by the business
culture to behave in certain ways. Just as we ourselves have had to
unlearn some of these conditioned responses, so will others.
Bert: So the unlearning is as important as the learning.
Iva: Yes, and to engage in that dual process of learning and unlearn-
ing we must continually strive for clarity about our assumptions.

Key Similarities and Differences

There were key similarities between Ivas and Berts situations:
Both were senior line managers who reported to others
higher up within a much larger system;
Both faced enormous external, competitive pressures but
were hampered in their ability to implement strategies to
respond to those competitive pressures;
Both inherited relationships with other divisions within the
system that were problematic and/or strained;
Both had to manage around unforeseen discontinuities,
such as a strike or a reorganization or downsizing.
Both had to manage to todays performance expectations
while trying to lead their respective organizations into the
future-without sufficient support or the auspices of top
management.
Iva and Bert responded in different ways to that similar set of
constraints.

Two Approaches: Pragmatic and Visionary

Both Iva and Bert embarked on their learning journeys and faced
these challenges without sufficient support or sanction. Without
upper level management support, neither Bert nor Iva could make
sustainable headway. Also, without very attuned coaching support
they also were not able to fully understand the limitations they
were facing nor make lasting breakthroughs in their own personal
development.
For the purposes of learning, we have characterized Bert as a
pragmatic leader who continuously responded to and adapted to
constraints. Using the proverbial metaphor of the elastic band to
represent the tension created when we consider both current real-
 Chapter 8 / The Double Loop: What Have We Learned? 175

ity and vision, we might say that Bert's tendency was to reduce the
creative tension by moving the vision closer to current reality.
Iva, on the other hand, represents our visionary tendencies. She
was on fire with the possibility of transforming the entire corporate
culture from Model I to Model 11. She attempted to "engineer" that
transformation without knowing or understanding exactly how she
was enlisting the existing organizational learning system (which
was most likely based in Model I) in resisting her efforts. Her goal
was to build a learning infrastructure. Her methods included
stretching the organization toward the vision, superceding con-
straints, and delaying attention to feedback and resistance.
Despite these differences, there were also key similarities in
the assumptions that underlay their strategies. In their double-
loop exchange they surfaced some of these key assumptions,
which are summarized in Table 8.1.

Table 8.1
Bert and lva's Key Assumptions

Bert's Key Assumptions Iva's Key Assumptions

I have to be the heroic leader 1'11 do the
learning for the organization
I understand the culture of my organi-
zation. I'll use my organizations culture
to change my organization5 culture
Personal values can be aligned with
organizational values.
I know what works in this organization.
I can't create too much tension in the
organization or I'll be rejected.
I can do this the same way I've always
done things-by trial-and-error-and I'll
succeed. I always do.
If I get the results, they'll see the value.
I have to be the expert; failure is intoler-
able.
I can't engage the whole organization.
(I don't know how so I won't tryj
I have to be the heroic leader. I'll show
them I'm right. I'll protect others.
I understand the culture of my organiza-
tion. The culture needs to change. I
know in what ways it needs to change
and I know how to change it.
Personal values can be aligned with
organizational values.
I know what works in this organization.
If I don't create enough tension, people
won't change.
I can do this the same way I've always
done things-by pushing hard-and I'll
succeed. I always do.
If I get the results, they'll see the value.
I have to be the expert; failure is intoler-
able.
I can't engage my boss. (I don't know
how so I won't try.)

What is the source of these assumptions? To varying extents,

the mental models of leadership that we hold are shaped by our
personality, our experiences and the culture of our organizations,
but they are also shaped by a higher level of assumptions embed-
ded in the larger context.
176 Part 2 / The Journey

In The Fifth Discipline, Ray Strata, President and CEO of Analog

Devices, Inc., makes the following observation:
Strata: (T)he "pragmatists" of modern philosophy take the
view that there is no point in worrying about general theory. You
should do what works, and whatever works today may not work
tomorrow. This view is strongly reinforced in contemporary man-
agement with its emphasis on solving problems. It's so easy t o
just go from one problem to the next, "from pillar t o post," with-
out ever seeing a larger pattern. Pragmatism denies any ability
of the human mind to synthesize, t o see a bigger picture.
Pragmatism has become dominant, in part, because of the
previous dominance o f elaborate theoretical systems that had no
real correspondence t o reality. The nineteenth century was a
great time for this; and the obvious failure o f these great sys-
tems o f thought like Marx's world system has been one of the
justifications for pragmatism.

Strata's quote underscores the need for practitioners of OL to

recognize that pragmatism and vision are not opposites so much
as complements. Good strategies should have elements of both.
Strata: I think, to some extent, we jump back and forth
between these t w o extremes of overconceptualization and pure
pragmatism because we don't have the tools t o connect them.
The core challenge faced by the aspiring learning organization is
to develop tools and processes for conceptualizing the big pic-
ture and testing ideas in practice. All in the organization must
master the cycle of thinking, doing, evaluating, and reflecting.
Without that, there is no valid learning.'

A Developmental Perspective
Rooke and Torbert (1 333) have developed a framework that may
help us to understand Bert's and Iva's behaviors. They describe five
levels of managerial "action-logics" (see Table 8.2) that represent
certain clusters of observable behaviors. Because these behaviors
can be observed to cluster together, we can assume that there is an
underlying "logic" or mental model (or theory-in-use) that holds
them together. Rooke and Torbert believe that these action-logics
also represent a developmental continuum. In other words, the
belief is that people can, and perhaps ought to, evolve from one
category to another as they develop, i.e., mature and change over
time.8
 Chapter 8 / T h e Double Loop: What Have We Learned? 177

Table 8.2
Managerial Action-Logics
Opportunist Seeks short-term concrete advantage for self;
rejects feedback; externalizes blame; manipu-
lates others.
Diplomat Seeks acceptance by colleagues; observes pro-
tocol; avoids conflict to save own and other's
face.
Expert Seeks causes and perfect, efficient solutions;
accepts feedback only from master of the par-
ticular craft.
Achiever Seeks effective results by teamwork; welcomes
goal-related, single-loop feedback.
Strategist Seeks to construct shared vision, transforma-
tional conflict resolution, and timely perfor-
mance through creative. wity, double-loop,
reframing feedback.
MagicianNitchKlown Seeks triple-loop transformation "systems expe-
riencing" that creates positive-sum, mythical
events and games by blending opposites 1e.g..
civil disobedience, feminist politics, social
investing)
Reprinted by permission from The Xysrerns Thinker (Pegasus Communications, 1999)

As Bert and Iva describe their struggles with their organiza-

tions, we can hear echoes of these action-logics. They talk about
their being valued and rewarded as experts. As a general rule, orga-
nizations tend to value and reward "expert" behaviors.
Rooke and Torbert maintain, however, that the cluster of
behaviors they call "the strategist'' best represents the capabilities
needed for leading a deep OL effort. The strategist is the "true
learning leader.'' The strategist is concerned with creating shared
vision. The strategist manifests "vulnerable power'' and models
vulnerability to personal transformation-without, somehow,
making him- or herself too vulnerable.
Executives who find a connection with OL often want to
evolve their leadership style to mesh with their evolving beliefs,
values, and what they now aspire to. Yet, the work of evolving
one's leadership style is difficult because there are many factors-
both internal and external-that contrive to keep managers and
leaders in their old, familiar grooves. Bert and Iva both struggled
with how to evolve their leadership styles. In both cases people in
the organization noticed the attempt, but were also confused by
the inconsistencies and questioned the authenticity of the change.
How does a leadership style evolve?Argyris believes it requires
engaging in a deliberate dialectical process to learn to act in accor-
dance with Model I1 theory-in-use. Brian Hall has written that
178 Part 2 / The Journey

personal transformation and development is facilitated by learn-

ing interpersonal and imaginal skills and by learning how to think
systemically. With this view in mind it seems that developing
ones skills in the organizational learning disciplines of systems
thinking, shared vision, personal mastery as well as generative
conversation can facilitate the developmental process of man-
agers.
What are the critical qualities that define a leader of learning?
In the following section we will hear from other leaders of OL
efforts about what they have learned about leadership.

Endnotes

1. Ralph Stacey, Managing the Unknouiable: Strategic Boundaries

Between Order and Chaos in Organizations (San Francisco:
Jossey-Bass, 1332), pp. 2, 4, 14, 197-138.
2. Edgar H. Schein, Organizational Learning: What is New?, in
M. A. Rahim et al. (eds.), Current Topics in Management, Vol. 2
(JAI Press, Inc., 1337).
3. Peter Senge et al., Dance of Change: The Challenges of Sustaining
Momentum in Learning Organizations (New York: Doubleday,
1333), pp. 26-30.
4. For more on Type A, see Meyer Friedman and Ray H.
Rosenman, T j e A Behavior and Your Heart (New York: Alfred
A. Knopf, Inc., 1374).
5. Emily T. Smith, et al.,TheWomen Who Are Scaling High Tech
Heights, BusinessWeeh, August 28, 1383, pp. 86-88.
6 . Warren G. Bennis and Edgar H. Schein (eds.), with the collab-
oration of Caroline McGregor, Leadership and Motivation, Essays
of Douglas McGregor (Cambridge, MA: MIT Press, 136 6 ) .
7. Peter Senge, The Fifth Discipline: The Art and Practice of the
Learning Organization (New York: Doubleday, 1330), pp.
350-351.
8. Excerpted from THE SYSTEMS THINKER Newsletter article The
CEOs Role in Organizational Transformation by David Rooke
and William R. Torbert. (Waltham, MA: Published by Pegasus
Communications, Inc., 1333).
3. Brian P Hall, The Genesis Effect: Personal and Organizational
Transformation (New York: Paulist Press, 1386).
 Part 3
Lea d e rsh ip
A great deal has been written about leadership per se. Much has
also been written about the role of the leader in organizational
change. Without diminishing those contributions to the field of
leadership, we offer a contribution because we believe that there
is a need to deepen our understanding of learning leadership as
lived and experienced by leaders.
There is vision and there is current reality-and then there is
the gap between the two. So, too, with leadership we have a cur-
rent reality: leaders who have been shaped and rewarded by tradi-
tional organizations yet who are also reaching out for a new par-
adigm of leadership. We have a vision: abundant concepts of effec-
tive, transformed leadership. And we have the gap in between.
What is still missing, we believe, is the bridge between the two: a
specific sense of the pathway of transition.
To that end we set about on a search for a pructical model of
leadership. We wanted to investigate how other leaders of OL
efforts trod that path and what they encountered along the way.
What did they think? What did they do? What did they learn as
they evolved their leadership? It is our hope that these learnings
about leadership might help leaders to transition successfully
from their current styles-which may include a heavy reliance on
command-and-control-to a new leadership model which con-
tributes to organizational learning.

179
180 Part 3 / Leadership

In the previous chapters we focused on Iva and Berts journeys.

In the following chapters we share what we have learned from our
interviews with four other leaders of change who were also pio-
neers in OL. They are:
Phil Carroll-former CEO of Shell Oil and current chair-
man and CEO of Fluor Corporation;
Dave Marsing-former Vice President, General Manager of
Assembly Test Manufacturing for Intel, and now COO of
Intels new Network Communications Group;
Bill OBrien-former CEO of the Hanover Insurance
Company and founding partner of the Centre for Generative
Leadership, a consulting firm; and
Rich Teerlink-former chairman of Harley Davidson.
Each of these leaders brings a unique perspective to the table.
And yet, there are common threads which, if woven together, may
help us all to evolve our collective wisdom about leaders, leader-
ship, and profound change. In the following chapters we have
tried to weave their perspectives and reflections on leadership
together with our own.
Chapter 9
Leadership: An Inquiry

Mind Images of the Organizational Learning Leader

In this chapter we attempt to identify some of the distinctive char-
acteristics of OL leaders. We believe that such leaders are leaders of
a transition: the transition from one kind of business organization
to another, the shape of which is still being formed. For this rea-
son we dont think of the profile of these leaders as being either
uniform or fured; rather, we think this type of leadership is still
evolving.
All of the leaders we spoke with are foresighted; yet they dont
all see the world exactly the same way. There are individual varia-
tions. Likewise, none of the leaders lead in exactly the same way.
Each leader is shaped by his own personal experiences and his
own perspectives on reality. Yet there seems to be some conver-
gence, and we think that convergence is illuminating.
So, while there is no formula, no course of instruction for
becoming this type of leader, we think that there are some charac-
teristics that mark OL leadership. In this chapter we try to identify
some of those critical attributes.

Whither the Heroic Leader?

Iva: Id like t o frame our discussion o f leadership by referencing the dis-
cussion o f leadership in The Dance ofchange. The authors talk about the
tendency in our business cultures to continuously reinforce the notion of
heroic leaders. Instead, they see leadership as a systems phenomenon. Now
were about to share the results of our interviews with several executive
change leaders and I wonder, are we about t o reinforce the concept o f the
hero leader?

181
182 Part 3 / Leadership

Bert: I'm not ready t o throw out the notion of the heroic leader just
yet. In fact, OL needs heroic leadership-particularly heroic executive
leadership. While leadership is important a t all levels, we are still in cor-
porate environments where executive leaders set the tone for an organi-
zation. They can change the direction of organization. They create the
environment where change can occur. They can also provide an environ-
ment where change will be killed.
But at the same time, I don't believe that the success of a change
effort should be invested in one person or that one person creates mon-
umental change.
Iva: But if we focus on the individual executive leader, that'll tend to
reinforce the importance of those leaders t o the change process-
Bert: No. That's not our message. If the culture o f a company is such
that everybody believes that everything is up to the people on the so-
called "top," then there's a problem. Even though the company may be
very successful financially.
At the same time, I do think you need executive leaders to catalyze
change. I believe they can do it in a variety o f ways, depending upon the
culture and the leader. In our interviews we saw several different mod-
els. If that's not heroic, then i t is a t least insightful and creative. And it's
certainly leadership.
Iva: It's heroic because most of today's leaders were brought up in
the command-and-control environment. They are now trying to change
that. They're willing to move away from the system that brought them t o
power and they're willing to try to build a bridge to the new model of
management.
Bert: They're heroic because taking that on is in defiance of the
dominant management paradigm of command-and-control, So there ure
heroic leaders in OL, but they are heroes of a different kind.
h a : They are the heroes of the transition. And in this chapter we
honor what we have learned from some of them.

Fi rst Learning : 0rga n izat io na I Learning

Leaders Are Pragmatic Visionaries
Iva: One of the first things we learned in our investigation was that
leaders who have embraced organizational learning tend to see their work
in a larger context. Their lenses are sensitized. They believe that there are
significant events that are affecting the reality external to the organization.
They have an innerknowing about how those forces are shaping up and how
they will affect the future. In this sense, they are visionaries.
Bert: At the same time, OL leaders also seem t o blend that strong
sense of vision with a strong sense of current reality. They can see the
practical implications o f that vision for the firm's success. They are able
to craft a link between their sense o f changing external reality and prag-
 Chapter 9 / Leadership: An Inquiry 183

matic results. They can effectively translate their vision into strategies
and tactics that have meaning for the firm and engage in the process of
educating the firm so people understand how the strategy links up with
resu Its.
Bill O'Brien is in many ways the founding father o f organizational
learning. He presents his interest in OL as extremely practical.

Bill: In the beginning I certainly didn't conceive of myself as

leading a movement. I just recognized in my corporation a basic
sickness. Then I met Peter Senge and I thought, "Here's this
whole body o f knowledge and practice called organizational
learning. Wouldn't it be great if we could apply this knowledge?"
Let me give you an example. When I came into the business
I was pretty shocked to discover that "spin" is a professional
activity in a corporation! And it's worse now than it ever was.
We would have a meeting and decide what we're going to do.
Then somebody will say, "We need t o have a meeting tomorrow
to decide how we're going to tell people what we're going to
do." Well, if there's integrity in what we're doing, why do we
need a separate meeting? Why don't we just go out and tell
everybody what happened.
I wasn't smart enough to figure out what all this spin was
doing, but I believe that i f you tinker around with the truth,
there are bad consequences. Oh, of course, we might fool some-
body into buying stock because we put a little spin on how well
our company's doing-but the ultimate consequences are that
nobody trusts each other any more. If spin works with outsiders
then pretty soon there's spin inside the company as well.
Everybody's spinning everything and suddenly the whole corpo-
ration is built on distrust.
I felt the same way when I saw how we hoarded power. First
of all, it's unhealthy for the hoarder. It's not congruent with
human nature. And what does it do to the enterprise? It makes
everybody get in a lackey mentality so they're checking their
imagination and their creativity a t the front door. They just want
to be told what t o do. What does that do with relationships
between people? We say to ourselves, "Oh, there's no sense talk-
ing to this guy, he just goes by the book." This human frailty of
hoarding power is causing dysfunction.
I saw all this dysfunction in my company, and I thought, "If
we could eliminate all that, what would happen? How much
more productive would we be!" And I believed to the bottom of
my boots that if we did this we'd make more money. I looked at
the other hundreds of insurance companies who were plagued
184 Part 3 / Leadership

with the same diseases and I thought, "If we only get 20 percent
better, we could run circles around them." And we did!

Iva: While Bill insists that his aims were modest and very grounded,
he is also acutely aware o f the thrust o f history and its impact on busi-
ness organizations.

Bill: The way I look a t it is: For 300 years the family business
was the way commerce was conducted in this country. It was
during the 1920s, or maybe a little earlier, that the large corpo-
rations, General Motors, Ford, Dupont, began to ascend. And
obviously in the 1970s a t the thrust of the Japanese invasion of
electronics and automobiles, they began to dysfunction. The
dysfunction was all the things we just talked about, the hoard-
ing of power, the spin, the alienation o f the worker.
Out of that crisis is born a new form o f governance that's
going t o succeed command-and-control. I don't think there's
any question that the basic governing theories that took us from
1920 to 1990 are being seriously renovated. We're going to have
a new architecture and this new generation of management has
got the rare privilege o f participating in the design o f the archi-
tecture-while a t the same time they have to run the ship.

Bert: I concur with what Bill said. I also see OL in the context of his-
torical evolution, but I see it somewhat differently. Early on when we
were trying to organize work we adopted Frederick Taylor's modeL2 We
designed work by breaking tasks down into their smallest components
and then measured how long it took people t o perform them. That
became our management model. Eventually we became so focused on
breaking down and measuring tasks that people didn't count a t all. For
many years this Taylor principle dominated management thought until
the classic experiment at Western Electric where scientists tried to mea-
sure the effect o f improved lighting on productivity. The scientists dis-
covered that it wasn't the lighting but the fact that the scientists were
paying attention to people that actually led to improvements in produc-
tivity. They called that the "Hawthorne Effect." So the business world
began to pay attention t o people. But then that was followed by a focus
on statistical quality control and we started breaking tasks down again.3
Then came reengineering.
Now it seems that we're going back t o paying attention t o people
again. We're beginning to see that people are our most competitive
advantage. We're beginning to understand that there are a few key fac-
tors that will differentiate one company from another. Those factors are
creativity and the ability to innovate and solve problems. All of those
 Chapter 9 / Leadership: An Inquiry 185

things involve people and that's where OL comes in. Competitiveness is

directly linked to the capacity of individuals and organizations to learn.
Success is a function of who learns faster and better about what the
marketplace is saying-and who is better able t o put in place strategies
that attune the organization so that they are better able to learn and
respond.
Iva: You see a kind o f oscillation whereas Bill observes a sea change.
Nevertheless, your points of view converge.
Bert: As CEO of Harley Davidson, Rich Teerlink saw some tough
times. Harley went through a make-or-break survival period that lasted
five long years (from 1981-86). Rich seems t o have come out o f that
period with new insights.

Rich: Essentially, a business does three things on an ongo-

ing basis: it creates demand (marketing), it produces product
(manufacturing), and it helps, i.e., it provides support or service.
One of the things we learned, I think, during our "survival period"
was that all parts of the business must function well and
together. We learned that if it's not together, you're in trouble.
For example, we always had strong marketing, but when our
manufacturing was inferior, our market share was down t o 13
percent.
As we looked at what was going on in our company, I kept
saying, "We've got t o realize our interdependence upon one
another." Whenever things went wrong it was because we
weren't recognizing that interdependence enough. People
weren't talking t o one another.

Iva: When Phil Carroll was the president and CEO o f Shell Oil he also
saw a great need for change. He evaluated his organization in light of
the larger context and saw a serious mismatch.

Phil: At the time I took over Shell Oil it was operating as an

independent entity. I believed that was becoming an anachro-
nism. The organization o f Shell was based on the nation-state;
every country had its own Shell company, with its own chief
executive.
That was the manner and form of the management philos-
ophy. It was the right model for the post-war world, but with
what's happening today in the world, both technologically and
in the process of globalization with the intensification of com-
petition, you can't do that anymore. You've got t o globalize,
186 Part 3 / Leadership

you've got to make central decisions, you've got to have better

access t o true market data at a global level.

Bert: I saw some similarities between the challenges Phil had a t

Shell and those Dave Marsing faced a t Intel. Dave had the formidable
challenge of continuously retooling manufacturing capability in order to
keep up with market demand.

Dave: One of the dynamics a t work within Intel is to reduce

both the overhead and the cost of what we make. Furthermore,
as the market demand shifts toward more generic products with
perhaps less high performance, we've got to respond. So we've
got to be able to introduce new products very quickly. That
means that our manufacturing has to have a tactic that enables
us to retool very fast. We have to be able t o develop a prototype,
develop the product, do initial qualification of the product, and
then ramp it to maximum volume as quickly as possible.
Now to accomplish all that, we've had to ask people on the
factory floor to take on decision-making responsibilities the like
of which they've never had before. We can't afford t o populate
the factories with Ph.D.s in electrical engineering, but we really
need people who can make decisions with the minimal direction.
If they need help, they need t o be able t o get it from anywhere
in the world. That's no small challenge.

Iva: Again, this practical view o f the here-and-now is tempered with

a sensitivity t o changes in the world outside the factory.

Dave: Our work is really taking place in a global setting now,

and one o f the things that concerns me is the three decades of
training that people have had in how to be very autonomous in
their own particular physical site. Until about three years ago,
the sites didn't have to interact. Nor was there any formal inter-
dependence between any of the sites. There was no connection
between what one site did with another factory anywhere else
in the world, other than the traditional linear supply line.
But that has changed. Now the environment is such that the
factories depend upon each other and one factory cannot really
make a decision unilaterally.
That presents us with a significant challenge. We've got t o
change behaviors. Part o f the challenge is getting people a t each
 Chapter 9 / Leadership: An Inquiry 187

site t o shift their priorities away from optimizing their local site
and shift it toward trying t o figure o u t the right thing t o do for
a whole network o f factories.

Iva: In all o f these cases it seems that it's an awareness o f pragmatic

issues, and the larger forces that create those issues, that gives rise to
vision.

Second Learning: The Centrality o f Values

Bert: I believe that the source of OL leadership is the strength o f your
conviction. A t the heart are values. Again and again, our leaders emphasized
the importance o f a core set o f values. For example, according t o Dave
Marsing, leadership begins with a focus on people.

Dave: To be an effective leader in the kinds o f domains and

contexts t h a t we've been talking about is impossible without
having an appreciation for the richness and the diversity o f the
people in your organization. That's a prerequisite. Then, leader-
ship itself is merely opening the opportunities for people t o see
who they are and t o achieve their potential.

Iva: Yes, Dave really has a focus on people. And it isn't just a sim-
plistic notion about how people are a competitive advantage-it isn't the
kind o f idea that falls apart the minute priorities shift. It's a sophisticated
understanding o f people t h a t includes an ability t o esteem and deal
effectively w i t h the varying traits, skills, and capacities t h a t people bring
t o work. Dave Marsing's OL work focuses on Human DynamicsTM.Human
Dynamics is a body o f work that identifies fundamental distinctions in
how human beings function as whole systems and helps people t o rec-
ognize, value, and develop their o w n diverse capabilities and those o f
other~.~

Dave: Our selection process a t the factory was certainly

influenced by w h a t we learned about and our commitment t o
the principles o f Human Dynamics. We looked for and hired
people who valued the capabilities o f others and who saw
developing the potential o f both the people under them and
those around them as an important aspect o f their work. The
message we gave them when we brought them in was: Develop
the capacity o f your organization. The message was not: Go in
and be technologists.
188 Part 3 / Leadership

Bert: Dave's work with Human Dynamics seems t o spring out o f a

deep commitment t o the value o f people's strengths and gifts. Values
were also a t the center of Rich Teerlink's work at Harley.

Rich: Values have always been important t o me. Very impor-

tant. I once had a very prestigious job but I quit because I dis-
agreed with the values o f the company. I felt that senior man-
agement was more interested in senior management rather than
the whole business.
So when senior management a t Harley was considering its
vision we started with discussion of our values. Only after that
did we discuss the issues and the stakeholders, and then we
talked about the vision statement. That's a little different because
most people start with the vision first. Instead, we started asking,
How do we want to behave towards one another? What's impor-
tant t o us? And, who do we serve?

Bert: I see values as the source o f commitment. Phil Carroll's strat-

egy a t Shell was about creating an alignment between personal and
organizational values, which I believe is critical.

Phil: Commitment comes only when people perceive that

their life and their priorities are consistent with and tied t o the
priorities and direction o f the company. I mean, they can be a lit-
tle off, but if those are not basically lined up, then you have an
uncommitted workforce. In the long term, that's a formula for
going out of business in these competitive times.

Bert: If there ever was an important point, that's it. It's so important
to have articulated, shared values up front. This is the linchpin.
The only argument against it is that sometimes values come out as
platitudes. Most companies have values, but does the leadership walk the
talk? Do the people in the organization walk the talk? The next question
is: Do the corporate values align with employees' values?
Iva: I understand that Rich Teerlink's organization had a process for
aligning personal and organizational values. It's a process that asks you
to define what it is that you value and also determine whether you have
in place any practices that contradict those values. For example, one of
the things that drive organizations today is fear. OL leaders don't exploit
fear as a source of motivation.
 Chapter 9 / Leadership: An Inquiry 189

Phil: The most prevalent dysfunctional emotion that is

present in corporate life is fear. And t o say that you're going t o
deal with effective functioning of corporations without having
the ability t o deal intelligently with fear is very shortsighted.
Most people say, "Yeah, well, fear is a weapon. It's a tool o f man-
agement t o scare people into behaving in certain ways."
Fear is a very debilitating thing in terms o f individual and
collective performance. If you don't know how t o deal with that
one emotion-if nothing else-you're in trouble. Particularly if
you're trying t o produce the right kind o f alignment-the true
alignment o f individual and corporate values that produces real
commitment on the part o f individuals.

Bert: If there's fear in the organization, then the values are just plat-
itudes. The leadership doesn't know how t o live up t o them and every-
body knows it. A leader should make an objective assessment of what
they are doing and how it relates to their values. The whole leadership
team should do that.
Iva: If leaders draw their conviction from values, what is the source
of these core values?
Bert: Bill O'Brien theorizes that those values come from an underly-
ing belief system.

Bill: Leaders must have a philosophical worldview into

which they integrate what they learn from Senge or Argyris or
somebody else. You cannot lead an organization if you are
dependent upon the thinking of any management guru. You
cannot lead an organization without having a belief system o f
your own.
That belief system has t o be more holistic than what they
teach you in Wharton about financial models or what they teach
at Babson about accounting or what you learn in engineering
schools. We promote all of our leaders because of their creden-
tials in these physical belief systems, but to really get people t o
rise above the ordinary, you've got to have a metaphysical belief
system-a set o f core beliefs that transcend the merely physical.
That's important and we don't pay enough attention t o it.
I don't think that people need to get this metaphysical belief
system from some special school, but they've got t o get one.
They've got t o give thought to human nature, human purpose,
the role of the corporation in society, the role of work in happi-
190 Part 3 / Leadership

ness, in life. They've got t o have some kind o f a metaphysical

belief system in which t o integrate all o f this other knowledge. I
mean, I got excited about systems thinking, for example, but it
was not my core belief. It was integrated into an already-exist-
ing set o f core beliefs.

Bert: Bill is saying that OL should not take the place o f a more fun-
damental belief system. I agree w i t h that and I think that has happened
t o some people. That's partly why there is some danger o f OL being per-
ceived as a cult. People have t o be careful about losing their footing and
becoming too carried away.
h a : I agree, but the notion o f a belief system-particularly a meta-
physical belief system-is controversial.
Bert: Granted, but i f you're going t o be a leader, you've got t o have
a leadership philosophy. It may not be a metaphysical philosophy, but
you've got t o have a philosophy o f business and that philosophy needs t o
include ethics. You've got t o have a philosophy o f right and wrong.
You've got t o have a practical philosophy. Organizational learning can't
be a substitute for that philosophy.
h a : No, but OL can certainly contribute t o it.

Third Learning : Orga nizationa I Learning Leaders

Are Master Strategists and Tacticians
Bert: These leaders seem to have an inner knowing about how external
forces are shaping the business world and, perhaps, the course o f history.
Iva: And, as a consequence, they've been able t o articulate a tra-
velable path t o the future. They know the steps t o take that will guide
their organizations into that future. They are expert navigators because
they can read the stars and they also have a sense o f the currents and
the shoals, the tides, and the eddies.
For example, Rich recognized t h a t the traditional functional
stovepipe method o f organizing had created unacceptable blocks t o
communication. With assistance from an organizational consultant, Lee
Ozley, he began t o envision a new form o f governance.

Rich: We started by viewing the business as having three

primary activities-producing products, creating demand, and
providing support. We visualized each o f these as a circle. Each
circle had 5-8 key people so we had a total o f about 20 key peo-
ple in all. We named them the Functional Leadership Group.
Then we put those three circles together in a Venn diagram.
Interesting thing! Now, they overlap. That implies interdepen-
 Chapter 9 / Leadership: An Inquiry 191

dence. Then we drew a big circle around it and we put our stake-
holders outside the circles and we had arrows going out from
each one of the circles which illustrated that we all served the
stakeholders but we were interdependent inside.
Where the three circles overlapped we established the
Leadership and Strategy Council which included the division
president and six peer-elected representatives from the
Functional Leadership Groups. All o f a sudden we've got natural
work groups o f 5-8 people. We couldn't call them that, of
course. We called them "circles" because i f we called them nat-
ural work groups people would have said, "We're vice presidents,
we're not work groups." But it turned out t o be natural work
groups.

Bert: Rich and Phil destroyed the structure that was supporting
command-and-control by creating a structure that supported interde-
pendence. That was extremely insightful and very courageous given the
fact that this company had come from a situation where it had been in
financial trouble. They did it when the company was financially sound,
but it was a risk because it could have set them back.
Iva: Rich led the way to the future by creating a new structure and
he did so in a way that didn't threaten people too much.
Bert: Phil Carroll also envisaged a structure that would bring about
a new way o f working.

Phil: In 1997 Shell initiated the process o f globalizing its

business worldwide. Let me define what I mean by "globaliza-
tion." The concept was that you set up global organizations with
worldwide coordination and a certain amount o f decision mak-
ing, but under that layer you have a whole series o f connected
nodes where people and strategic business units can operate
with relative autonomy.
The only thing required is that while you pursue your inde-
pendent goals in whatever node, you also have to think about
the network. You also have t o be linked financially because the
financial strength o f the whole is vastly superior t o the individ-
ual elements. Additionally, you have to be linked with informa-
tion. That is, your knowledge, skill, and commercial intelligence
has t o be available to all others. Finally, you also need to have,
within limits, the ability and necessity of moving key people
among those nodes.
We began to evolve toward this networked organizational
structure. Below the general structure there are now a whole
192 Part 3 / Leadership

host of relatively independent but highly connected business

entities. So, instead o f being geographically-based, they're now
globalized and networked.

ha: Along with changing the structure, Phil took some brave steps
toward reviving the human element in his organization.

Phil: Along with the rest o f our Leadership Council, I

embarked on a journey o f what I call "personal integration." This
was a major journey for me. M y fundamental belief with regard
to business was, "Look, this is all about logic. This is all about
factual data and information." We did not deal with the emo-
tional side of ourselves because it wasn't relevant. That belief
was very strongly ingrained and I was very protective of it, but
with help from some consultants I began to see that everything
that happens to us has an emotional element and that t o ignore
the emotional aspect of things completely is not healthy.
We began to practice integrating emotion and logic. I
believe that these skills are essential if you're going to do any-
thing akin t o really building coherence and cohesion a t top
management levels. People have to be able to have those kinds
o f conversations.

Bert: Dave Marsing's strategy also involved a blend of technological

improvements and the development of specific people skills.
Iva: Yes, but their approaches had to be different. As executive
leader, Phil Carroll assumed a great deal o f responsibility for the overall
approach t o organizational change. Marsing's strategy was to seed the
organization, t o open minds and set a learning process in place, and then
to shepherd people along as they went on a learning journey with him.

Dave: How did we respond t o those kinds o f needs at Intel?

Number one, we've made pretty significant investments in infor-
mation technology systems that allow access t o those resources
around the world. Secondly, we've built the capacity in our peo-
ple t o make the decisions that get the kind of results that keeps
the momentum of improvement going without major setbacks.
So, as the demands on the people who are working on the
floor increase, we continuously reengineer their jobs on two
fronts. We provide more automated solutions t o help them run
their areas and we also leverage their problem-solving skills. We
enable them to work better together, both with people in the
 Chapter 9 / Leadership: An Inquiry 193

same factory and with people who are running similar modules
in another factory somewhere else in the world.
A primary tool for accomplishing that later challenge has
been the use o f Human Dynamics.

Iva: Dave's work with Human Dynamics is good business strategy but
it's also more than that. You can really perceive the value he puts on
human potential by listening to the way he talks about it.

Dave: From my perspective, the Human Dynamics work gives

you the opportunity to affirm your sense of yourself in a very
positive way. You begin t o see your strengths, idiosyncrasies, and
attributes as part of a whole spectrum of human talents rather
than comparing yourself-perhaps negatively-to the dominant
norm o f your family, community, work organization, or culture.
At the organization level, this gives a tremendous founda-
tion for doing work around the appreciation o f diversity in an
organization. You find that you actually go out and seek out the
diversity t o get better answers.

Bert: Dave has also found a way to strategize about these larger
issues by leveraging organizational learning tools and techniques includ-
ing Human Dynamics.

Dave: Our strategy for getting there involves the use o f OL

tools like causal loop diagrams. But it also involves having what
Senge calls generative conversations, having genuine dialogue
around these issues.
Now, let me lay some context. In the past, in some cultures,
people have not been comfortable being a part of the dialogue.
And the reason behind that is twofold: First, they don't really
want to talk. They'd just as soon take an order and go execute
and meet whatever they think the expectations were. If they hit
the objective they think, "Great, we'll be left alone." So they
marshal the resources to make sure they'll get that accom-
plished and then behind that, they do whatever they want t o do.
The second reason that they're uncomfortable is that very
often English is not their primary language. So their involvement
in a very in-depth and abstract dialogue is very difficult. This is
far from a done deal, but Human Dynamics has enabled us to
begin to surmount those barriers by helping us develop a lan-
194 Part 3 / Leadership

guage that was common among all the people from all the dif-
feren t cu Itures.
At an international and global level, it has really amazing
capabilities. People begin t o realize that some o f the issues that
they encounter aren't so much cultural differences as they are
running up against clashes between dominant dynamic norms-
between, say, Santa Clara, CA and Penang, Malaysia, or
Shanghai. Human Dynamics has given us the capacity to recog-
nize how different people process information. When you estab-
lish a foundation like that across an organization, the quality of
conversation, and the creativity and contribution o f coming up
with new ideas and new innovative approaches to problems goes
up significantly. It's an exciting place to be.
It's also very freeing both a t the organizational level and the
individual level. Watching people in Asia who have had exposure
in the last three years to this kind o f training is like watching a
person evolve out of a shell. I mean, all of a sudden you see peo-
ple who have passion and life and feel good about themselves,
as opposed to feeling that they're cogs in a huge machine.
Another result is that they begin to get a voice. In their cul-
ture, perhaps, they have been almost suppressed or oppressed in
a very hierarchical system. They expect that and they demand
that of the people who are above them. And they fall into these
roles. The Human Dynamics work, however, gives them a lan-
guage, it gives them a thought process, and it opens up tremen-
dous capability for them t o begin to really explore potential,
both their own and that of the people that they work with.

Iva: It seems that Phil, Rich, and Dave all developed strategies that
had a structural element-
Bert: And also placed value on human beings and on developing the
capacity of human beings. That's a common denominator.
Iva: It's also very different from the way in which we've traditionally
brought about restructuring. Generally we've thought about structures or
we've thought about people. Here, those two concerns are brought
toget her.

Fourth Learning: The Essence o f Organizational Learning

Leadership Is the Skillful Devolution o f Power
h a : Underneath Phil Carroll's drive to create a different structure was
a philosophy.
 Chapter 9 / Leadership: An Inquiry 195

Phil: I was interested in decentralization and atomization of

organizational structures. That idea was basically built on a
political philosophy regarding individual freedom within those
structures. The action that comes out o f that philosophy is that
you have t o devolve power.

Iva: To my mind it seems that the essence of the work of OL leaders

is to find how to intelligently give power away.
Bert: That may be too strong.
Iva: Maybe not. I believe that we're saying that it will benefit the
organization for power to become more distributed, and there are impli-
cations for leadership, as Phil said.

Phil: Everyone has positions or moments in the course of a

day when you defer to someone else. That's my concept or men-
t a l model of distributed leadership.

Bert: If power is distributed it means that the person-or team of

people-who have the needed knowledge or expertise take the lead at
that moment. Now the question is, Do we have the capacity within orga-
nizations t o do that? Phil gave a good summary of current reality.

Phil: Number one, a big problem in most companies is

developing and maintaining sufficient leadership capacity with-
in the organization. That is a big issue for all companies.

Iva: But Phil also said that people in organizations have latent
capacity for leadership.

Phil: The good news, I believe very firmly, is that all of us are
a t times leaders. Likewise, all of us are a t times followers. That
certainly goes for me. There are many times during the course of
a day when I properly function as a follower. M y secretary, for
instance, will take on roles o f leadership with respect to our
working relationship. She says, "Look, we're going t o do this,
that, and the other." I accept or defer t o her judgment because
i f I didn't want to do that I'd keep my schedule myself.

Bert: There's another aspect to leadership, which is that it has to also

be situational.
196 Part 3 / Leadership

Phil: Leadership is not the same in all situations. When

there's a fire in a chemical plant, for example, you don't want
any participative leadership. Instead you better have General
Patton there saying, "Do this. Do that." Conversely, when you're
up against complex problems that are not given to straightfor-
ward, known solutions, that requires a very different kind of
leadership.
Because leadership is now becoming situational, individuals
have to learn to take on the responsibility o f acting differently
depending upon where they are at each moment o f the day. At
any time you may have to make a judgment. Leaders may have
to ask themselves, "Hey, wait a second. Am I sitting here trying
to get consensus about how to install something?" That's not the
right leadership model for that situation. If there's a way to do
something you can be very direct about it

Bert: So everyone who intends to lead has to develop a kind of sit-

uational acuity, the ability to read and respond appropriately to different
situations.
Iva: There's more to it than that. All leaders-positional or distributed
alike-will have t o call upon others for help.

Phil: Many times the leader has to stand up and say, "I don't
have the answers folks. How are we going to do this and how
can we together work with or cope with or deal with this situa-
tion?" Now, that requires a very different leadership.

Bert: So, to summarize: Positional leaders must recognize that there

is a need for greater dispersion of power.
h a : And for a more collaborative form of leadership.
Bert: The implication is that there is also great potential for the dis-
persion of leadership within any organization. All of us are potentially
leaders at any time; likewise, all of us are potentially followers a t any
time as well.
Iva: We're also saying that as part of this new model of leadership
we have t o recognize that there is no one best way to lead. Hence, every-
one who would be a leader has to develop an almost instinctive ability
t o recognize what type of leadership is appropriate t o the circumstance
they're in.
Bert: Yes. And that also means that we don't invalidate command-
style leadership. If it's appropriate at the time, use i t !
Iva: I think I agree. So if leadership is distributed and situational, it
will also need to be far more collaborative.
Bert: O f course, there have always been leadership teams-
 Chapter 9 / Leadership: An Inquiry 197

Iva: But I sense that collaborative leadership is a qualitatively dif-

ferent kind of leadership than most o f the leadership teams that are
currently in place. By "collaborative" I mean that we recognize that
leadership can really benefit from taking into consideration much more
diversity. I am aligning here with Dave's perspective. If we can create
environments conducive to a more collaborative form of leadership then
individuals will come into leadership as their strengths and abilities are
required. Ideally, this would be a very organic process. We need to learn
how t o do that. There's great untapped potential sitting in organizations
already but we've relied on the hero leader for so long that this move-
ment toward greater collaboration can't happen spontaneously.
Positional leaders need t o do a lot of learning and soul-searching.
Likewise, people who aren't in formal leadership positions now need to
be effectively skilled and nurtured so that they are ready to take on more
leadership responsibilities.
Bert: That goes to Phil's point about why most "empowerment" pro-
grams fail. We seem to inadvertently set them up to fail.

Phil: You do someone an enormous disservice i f you

"empower" people in an arena where they do not have the skill
to operate. That's what happens most o f the time. Then people
say, "See, empowerment doesn't work." Well, sure, it doesn't
work i f you give someone with four years of experience the
responsibility for a huge billion-dollar project. That's dumb. The
workers weren't dumb. Management was dumb. You really have
go through a careful process o f inventorying skill levels so that
when you do empower people you're giving the responsibility to
people that you believe have the capability, the talent, and the
experience to carry it out-and you won't always be right.

Bert: It's unethical t o measure people on their results but not give
them the tools and skills t o prepare them. That's a perfect example o f
when the reason for failure is the system rather than the individual. The
reason for failure is our policy of cutting back on training and not giving
employees the tools they need. It's a setup, plain and simple. Phil Carroll
has done a lot o f thinking about how to develop leadership capacity
within an organization. He talks extensively about the principles that
underlie his strategy for developing leadership capacity.

Phil: There are, for me, three absolutely necessary conditions

that have to preexist in order t o carry out the exercise of devo-
lution of power or the production of more freedom in an orga-
nization.
198 Part 3 / Leadership

First, there has t o be truly a deep clarity about what is

wanted such that every employee knows what is expected and
what we're trying t o do in the company with respect to strate-
gy, methodology, approach, etc. Quite often that's not the case.
Often leadership only provides very simplistic directions such as,
"We want to grow the company very rapidly." That is not a suf-
ficient articulation o f what is wanted in a business.
Clearly, if leadership cannot make a convincing case for
where it wants to go, it will fail in its leadership. I believe that
it is leadership's general responsibility to shape that direction
and to articulate it. They also have the responsibility to change
the direction, if necessary, based on the input o f the people in
the organization. So clarity is a very important element that
requires an almost constant conversation and engagement with
people throughout the company.
That demand puts intense pressure on leadership to be con-
stantly in communication, repeating statements over and over,
answering questions, and discussing. The process has to be very
deliberate so that the result is a very clear understanding of the
company's direction.
The second thing if you have a very clear message of where
you're going is that you have t o be sure that the people have the
skills and capabilities to go there. It doesn't make any difference
if someone says, "Phil, we're going t o take you to the top o f Mt.
Everest"-I'm not going to make it. I don't have the capability or
the physical strength to climb Mt. Everest. For people who
empower individuals and say, "It's all yours. Here, son, are the
keys to the car. I'm sorry we didn't have time for driving lessons,
but take it out and I'm sure you'll do fine." Well, there's a wreck
in your future. And that's very clear.
The third element is that you have to have a just and clear
system of accountability. There have t o be consequences. It's OK
t o make mistakes. That's an important distinction. But if some-
one constantly doesn't execute, either by lack o f commitment or
demonstration that he or she doesn't have the skill, and there
are no clear and visible consequences, then people lose confi-
dence in the system.

Iva: Command-and-control environments create heroic leaders

because everyone looks to the leader to find out what they should do
next. Conversely, OL involves the process of skillfully devolving power,
shifting power away from the leader. Therefore, OL leaders are engaged
in developing the capability of the organization so they can give more
 Chapter 9 / Leadership: An Inquiry 199

power t o the people in the organization. That is heroic. Giving away

power is heroic. So it's a little paradoxical.

Fifth Lea rn ing : 0rga nizat io na I Learning

Leaders Are Stewards o f Learning
Iva: It's clear that OL leaders encourage others t o learn. The focus o f the
learning may vary, but this is their distinguishing characteristic.
Bert: If your focus is on learning, you'll be a different kind o f leader,
as Dave pointed out.

Dave: OL leadership is not like our traditional view o f lead-

ership. In the traditional view, the leader comes across as saying:
"I am going t o take you somewhere and show you how t o do
this." That kind o f leadership does happen, b u t in a way, OL lead-
ership is more like "husbandry." It's the practice o f cultivation. To
me an effective leader is a kind o f master teacher-but in a way
t h a t is very soft, t h a t is very gentle, but also very deliberate.
The role o f a leader is t o give people freedom, and enable
them t o think, contribute, and participate. If you take that away
from people, you might as well throw them in an institution, into
a prison, because the gratification o f doing a j o b and contribut-
ing disappears immediately. Therefore, the performance, the
overall long-term capability o f the organization is crippled.

Iva: I'm really struck by the idea of giving people freedom because
that has been such a strong idea in my life. Yet I also know that it's not
simple. Many o f us have t o learn how t o be free.
Bert: Many o f us managers have also spent our lives thinking o f peo-
ple as resources from which we extract value, b u t Rich redefines our job.

Rich: I've always had a bias toward believing t h a t if the

environment is right, leaders are almost unnecessary. So what
we've got t o do is create the right kind o f environment. M y fun-
damental premise is people are my long-term competitive
advantage. If that's the case then the j o b o f the leader is t o cre-
ate an operating environment where people can do great things.
That means t h a t you have t o invest capital and expense t o sup-
port the efforts o f people.

Iva: So leadership means creating opportunities for others t o expe-

rience deep learning.
Bert: Yes, and they also have t o operate on their g u t sense o f what
will enable others t o grow. They have t o trust in that process and they
can't back down. That's what I got from Rich Teerlink's story.
200 Part 3 / Leadership

Rich: There were some problems in the plant that weren't

getting solved. It was my sense that one person could not solve
the problem. So I decided to use t w o people with different back-
grounds.
Well, each o f them came to me individually and said, "You
know we can divide this job up. I could take this part and he
could take that part." I called them both in together said, "No.
You've got to understand. You are going out there together.
You're going t o work together to get this thing fixed."
Now it was clear t o them that they had t o work collegially-
which was a whole different approach for them. Not only that,
but the situation was set up differently. We usually sent people
out on missions like that on white chargers. We usually gave
them all sorts of formal authority, like giving them a big saber to
go and slash through everything. But this time we just said that
they're temporarily being assigned t o help. It was a whole dif-
ferent thing. It forced the t w o of them t o operate completely
d iffe re nt Iy.
The problem was bigger than either one o f them, and they
knew it. And they couldn't divide it up because I wouldn't let
them. So they each had t o go through the process o f learning to
value the other's perspective. Well, you know, it worked. And
they've both thanked me for that assignment.

Sixth Learning: Organizational Learning

Leaders Are Learners Themselves
Iva: I was struck by how open these leaders were to new learning them-
selves, despite their extraordinary gifts for vision and strategy.
Bert: That's not easy for many of us who have been known as
experts. It's not easy to let go of that recognition and credibility, but
Dave is very convincing.

Dave: I believe to be a leader requires the hunger and the

desire t o continue t o learn. Without that, I don't think a person
has the generative capacity t o continue to bring more resources,
more ideas, and more creativity into the kinds of evolving or very
fast-changing situations we have in business today.
I believe that because o f my own personal experience. I have
been very fortunate t o be a student o f some very old, structured,
orthodox disciplines in the martial arts. Once you make a com-
mitment to go down these paths, you make a commitment to do
i t for life.
 Chapter 9 / Leadership: An Inquiry 201

Leadership is the same. You have to be willing to be a stu-

dent forever. When I was 13, I had a martial arts teacher who
was 82 years old. His belief was that you really didn't know
something until you had done it 10,000 times. Correctly. Not
only that, he said it might take you 200,000 tries before you do
it once correctly. And that's only if you have a really good atti-
tude and a strong work ethic!
For these reasons I believe that there is a relationship
between the capacity t o be a good student and the potential of
developing the characteristics and the discipline of being an
effective and an effectual leader.

Bert: So leaders must be learners. At the very least, leaders will have
to learn some new skills, as Phil said.

Phil: You have to learn techniques, because OL involves a lot

of actual tools and techniques. There are concepts to learn like
the Ladder o f Inference and suspension o f judgment. Those
things are very important. Yet, most o f us in the corporate world
never heard of things like that. We don't know about them.

h a : It's not only that. Most of us were pretty good learners, in the
traditional sense. We mastered all kinds of knowledge t o get us where we
are today.
Bert: But this is different. Can you say how?
Iva: Many leaders are not used t o being learners because they are
used to being knowers-so they might experience a profound sense of
discomfort. Some o f us will resist learning OL tools and concepts and
instead we'll delegate those responsibilities to others. But once we get
over the fear o f appearing not to know, leaders can tap into the exhila-
ration that Dave found in his learning experience.

Dave: When you go through the process of learning about

yourself and others in the context of a Human Dynamics seminar
with 30 other people it's very ~ p l i f t i n gYou
. ~ finally have a lan-
guage that enables you t o talk about things as they pertain to
your own development as an individual. You can articulate what
your specific learning approaches and communication styles are.
This allows you t o function very effectively-and objectively-
within a team or organization. And you get the opportunity to do
that with people whose emerging awareness of themselves and
the people around them is happening at the same time.
202 Part 3 / Leadership

Iva: OL leaders need to be deeply engaged with the process o f learn-

ing. If not, they will not be capable o f sustaining the journey. I agree with
Rich.

Rich: Leaders have got to be more willing learners. And not

learners for the sake o f control but learners for the sake of being
able to present different concepts to people for them to think
about. Not necessarily to say, "We're going to do this," but
instead to help enlarge the sense of possibilities.

Seventh Learning: No Single Path

Bert: I was struck by the fact that in our interviews we saw such dif-
ferent approaches to OL. There wasn't a single path. Phil Carroll's OL work
was done within the context of people developing an understanding of their
business model. Rich Teerlink was using OL as a means for truly letting the
people learn. He didn't know where that learning would lead, whereas Phil
knew exactly where he believed the organization needed to go. Two differ-
ent leaders with two different approaches.
Iva: There are multiple pathways for bringing learning into your
organization. The choice depends on what the best fit is with your orga-
nization, your culture, your burning platform.
Bert: It's also interesting t o think about how each o f the four lead-
ers came to organizational learning from such different directions. Dave
links it to his martial arts practice.
Iva: Bill goes back into ancient philosophy and his metaphysical
beliefs.
Bert: Rich, I think, was a "natural."

Rich: Every place I've been, every job I've had, I've always
been a changer. I've been a CFO, but I was never a typical CFO.
I've been a member o f a union and actually lost a union election
by three votes. I've been a manufacturing plant manager. I've
been a strategic planner. I've been in a division level, corporate
level, big company, small company, public company, private
company. I just couldn't keep a job!
But always, I've just had a sixth sense that told me, "You
know, things could always be better." When you stop thinking
about things differently, when you stop thinking about how they
could be better, and you say, "Hey, we're here, we're pretty
good"-that to me is death. I honestly believe you're never as
good as you could be. That's in my bones.
 Chapter 9 / Leadership: An Inquiry 203

Iva: And Phil was willing t o let go o f his belief in the primacy o f
logic. Yet, there are these very significant similarities in the way these
leaders think.
Bert: All o f them have a capacity t o see a bigger picture. They try t o
bring their organization in alignment with what they see, encouraging
everyone t o help build a bridge between vision and current reality. Often
they make structural changes that focus their organizations on interde-
pendence.
Iva: They're also building that bridge by developing the capacity o f
the people in their organization t o share power and lead.
Bert: They value human beings and they show that explicitly by their
actions. They're willing t o challenge people t o learn and also help people
t o learn.
Iva: They're willing t o learn themselves, even though that may
require exposing their vulnerabilities and letting go o f old assumptions.
Bert: I'm also thinking that, w i t h the exception o f Dave Marsing,
these leaders were all CEOs.
Yet, the fundamental approach that each o f these people exhibited
is applicable a t all levels o f leadership. I don't want people t o give up i f
they're not a CEO. If you believe this is important, then you can go for-
ward.
h a : I very much agree, but I have a lingering question, Can anyone
become this type o f leader? How do you know if you have the capacity?
I'm thinking o f what Dave Marsing said.

Dave: Unfortunately, not all managers can be learning lead-

ers. Some managers are so sensitive and so fragile in their egos
that they can really wound and hurt a very capable organization.
The pairing o f the motives o f both the teacher and the student
is also very, very important. Not all people want t o be led and
not all leaders want t o take responsibility and accountability for
the health and integrity of an organization and its people. Nor
do they have the compassion or the ability t o be attentive t o
them.

The OL leaders of today are leaders of a transition. They are

willing to go where the path leads them, never rejecting the possi-
bility of learning no matter what the source. They are passionate
about and committed to a vision that they think is infinitely prac-
tical and attainable if we are willing to learn-and unlearn-all
along the way. But where will these much-needed transition lead-
ers come from? Can they be produced by our customary manage-
ment education? Bill O'Brien thinks not.
204 Part 3 / Leadership

Bill: We spend a great deal o f money and time in this coun-

try talking about leadership and designing leadership education,
but I don't think we have any idea what we're talking about.
There was a time in my life when I was awed by the Harvard
Business School. There was a time when the Fortune 500 were
all Harvard B-School graduates. But now I believe that those
business world giants were really molded in the combat o f WW
II, not at Harvard. Today I'm afraid that we're not producing
great leaders in our graduate schools. We may even be produc-
ing great plunderers-people who know how t o siphon off
wealth that others have created.
If you look around a t the real leaders in the world today you
see people like Nelson Mandela, who spent 27 years in prison.
You see Vaclav Have1 in Czechoslovakia, who spent seven or
eight years in jail. Pope John Paul II was once in a forced labor
situation. The conclusion that I've come to is that the people
who are going to do the leading ought to emerge out o f the suf-
fering of the organization. "Suffering" could be too strong a
word, but certainly leaders need to have experienced firsthand
the frustrations o f dealing with the politics, the bureaucracy, the
inconsistencies o f today's business organizations. And then, the
miracle is that rather than becoming cynical or defeated,
through some kind o f internal alchemy they've turned that frus-
tration and pain into a constructive frustration.
That's the transforming energy that's going t o help us make
profound change in our organizations. It's generative energy and
it's informed by both experience and compassion.

We agree with Bill that it does not seem likely that traditional
management education can create these learning leaders, these
leaders of the transition. Rather, these leaders may need to be
forged by life experience. The way in which each leader arrives at
this point seems to vary. Bill O'Brien's own story provides a good
example.

Bill: I would say that the reason why Peter Senge and I have
had such a fruitful relationship is because we both are heading
in the same direction. He's going by way of knowledge and
learning and I go there more by way o f virtue and ethics.
Back in 1980, I was working with the president on a strategy
for the company and we hit some snags. We knew we hit these
snags because we were basing our strategy on linear cause and
 Chapter 9 / Leadership: An Inquiry 205

effect thinking. So one day we brought in an iconoclastic, bril-

liant professor from the University of New Hampshire who had
developed a course he called "Thinking about Thinking," subti-
tled "Sandpaper on the Brain." He took us all the way through
the evolution of Western thinking, including Descartes, Galileo,
and Edison, all the big ideas and inventions. We all just sat there
and said, "My God we should have paid more attention when we
went t o school! The stuff wasn't as useless as we thought it
was!"
Then he took us through Eastern thinking and discussed how
they looked a t the world as a process or a flow versus a snap-
shot, which is the way we tend t o look a t it. Then he explained
the concept of "unintended consequences" to us. We began talk-
ing about breaking down the walls that we'd built up around our
thought processes and how these walls were keeping us from
using all o f our brainpower. This was almost 20 years ago, long
before these ideas were in vogue.

There are many paths that can lead to a commitment to orga-

nizational learning. The leaders of the transition may begin by dis-
covering that their current thinking is inadequate to guide their
actions, so they go spelunking, in search of new ideas. As they go
on their learning journeys they may find wisdom in unlikely
places, perhaps discovering the roots of knowledge and integrity
in ancient traditions. One might also proceed by way of logic, see-
ing organizational learning as the next evolutionary step. Others
might show up through a process of reflection on the meaning of
their lives and their potential legacy; other9 may come reluctantly,
forced to seek new answers because of crisis. Others may be called
by a sense of mission. They may have awakened anew to this call-
ing, or perhaps it has always been their way of being. Whatever the
reason or the path, they arrive at an appreciation for learning and
an awareness that leadership must become more collaborative.
But how do people who have been conditioned all their lives
to be command-and-control leaders make the transformation to
being a learning leader? What does that transformation actually
involve? In the next chapter we explore those questions.
206 Part 3 / Leadership

Endnotes

1. Peter Senge et al., Dance of Change: The Challenges of Sustaining

Momentum in Learning Organizations (New York: Doubleday,
1399), pp. 13-20.
2. F. W. Taylor, Scientific Management (New York: Harper and
Row, 1911).
3. Edgar F. Huse and James L. Bowditch, Behavior in
Organizations: A Systems Approach to Managing, 2nd ed.
(Reading, MA: Addison-Wesley, 1937), pp. 22-24.
4. For more on Human Dynamics, please see Sandra Seagal and
David Horne, Human Dynamics (Waltham, MA: Pegasus
Communications, 1337).
5. The Human DynamicsTM body of work identifies fundamental
distinctions in how people function as whole systems. These
distinct human systems, termed "personality dynamics, cross
"

culture, race, age, and gender. Five personality dynamics have

been found to be by far the most numerous, and they are the
focus of Human Dynamics seminars. In those seminars the
participants, through a unique process, identify their own per-
sonality dynamic group. They also begin to understand the
ways in which the other personality dynamics function so dif-
ferently from themselves. In the flow of the seminar, partici-
pants gain the understanding of their own dynamics and the
appreciation of other dynamics in the context of learning
about teamwork.
Chapter 10
Reflections on Leadership

h a : I'm reflecting upon t h e f a c t t h a t all o f t h e leaders w e inter-

viewed seemed t o believe t h a t a key aspect o f learning leadership is t h e
devolution o f power.
Bert: OL leaders tend t o believe-and I agree-that i n order t o meet
t h e demands o f t h e changing environment business organizations m u s t
evolve i n t h e direction o f more collaborative leadership. Decision-making
power has t o reside w i t h t h e people w h o are i n t h e best position t o learn
f r o m t h e feedback and adjust their actions accordingly.
h a : Each o f t h e leaders had a different approach t o building t h a t
capacity. Bill O'Brien's w a y o f building capacity a t t h e Hanover Insurance
Company was t o get a w a y f r o m t h e hoarding o f power and focus on t h e
integration o f more meaningful core values i n t o t h e workplace. This
wasn't about values for their o w n sake. His idea was t h a t business results
w o u l d be improved by giving life t o these values.
Bert: A t Shell, Phil Carroll's focus was o n developing people's basic
understanding o f t h e business and related fundamental business skills.
Iva: A t Intel, Dave Marsing used human dynamics training t o develop
people's understanding o f their o w n inherent strengths and abilities as
well as those o f others i n their organization. As a result, t h e y had a
greater sense o f h o w t o draw o n and benefit f r o m each other's leader-
ship capacities.
Bert: Rich Teerlink a t Harley also b u i l t capacity, b u t he did it more by
virtue o f t h e w a y i n w h i c h he challenged t h e organization t o lead itself
rather t h a n by any kind o f formal training. He seemed t o k n o w rather
instinctively h o w t o lead w i t h o u t leading and h o w t o a c t so t h a t he could
bring f o r t h t h e leadership already inherent in people. For example,
remember w h a t he said w h e n w e spoke t o h i m about t h e beginning o f
their learning effort?

207
208 Part 3 / Leadership

Rich: I said, "Look, we need a revolution around here and I'm

not going to lead it." That's always been my philosophy. I'm not
going to lead a revolution. I'm not jamming it down the organi-
zation. I'm waiting for it to catch fire.

Iva: So in order for leadership t o become more collaborative, t w o

things need to happen: One, people in the organization may need t o
develop their capacity for leadership. That means that the devolution of
power isn't just about deploying an "empowerment" program. Positional
leaders have to design robust strategies that devolve power and create
greater capacity for distributed leadership-not an easy task, as Phil
pointed out:

Phil: You have t o believe very strongly that that's the right
thing to do. Then you have to have a sensible strategy, but one
that's also extremely flexible because you're going t o have to
learn your way through this. There is no map, no set of steps.
That's why so many attempts a t so-called "empowerment" fail
miserably. They are just too simplistic.

Iva: So the positional leader must catalyze a profound, systemwide

organizational shift to more collaborative leadership and then both posi-
tional and potential leaders must learn their way through the process.
There's a paradox built into that. As a positional leader, you must set that
clear direction. So, at least a t the beginning, you must act very much like
a "heroic" leader.
But then you have to skillfully devolve power in such a way that peo-
ple are no longer looking only to you for that direction. And-again, para-
doxically-that requires heroism. The real heroism comes in the act of
giving power away. It comes in giving up the role of hero.
Bert: There must be an art to making that transition away from
heroic leader so that it's seamless and doesn't create confusion for oth-
ers.
h a : Given what we just described, it seems that OL requires a unique
kind of leader. Dave Marsing had a perspective on that.

Dave: The maturity of the leaders of the organization is very

important. They have t o be mature in t w o senses. First, they have
to have a pretty sophisticated way o f looking a t the organization
and seeing its potential. Then, management has t o be willing to
surrender control. If a manager is not willing t o surrender con-
trol-or their ego isn't developed enough to be able t o surrender
control-organizational learning will never happen. There are
 Chapter 10 / Reflections on Leadership 209

more ways to kill this than there are ways to cultivate it. For
example, if the leader is a really good technologist who isn't very
well developed as an individual, i t doesn't stand a chance.

h a : I agree with what Dave said and so I do not see clearly how we
go from where we are today, where we have many hierarchical, com-
mand-and-control organizations led by heroic, even charismatic leaders,
t o organizations where leadership is more collaborative.
M y sense is that there will be leaders who see the value in OL, and
who will want to pursue it, but they'll get stuck because they will have
a difficult time surrendering control. For example, I know that I was try-
ing very, very hard t o model this new kind of leadership, but I know that
there were quite a few times when I slipped back into my old command-
and-control behaviors. I know this confused people in my organization.
Bert: I can't argue with that. I was a Theory X manager trying to be
Theory Y, and sometimes I'd overcorrect by going too far toward Theory
Y when I shouldn't have.
Iva: So I wonder, what can we learn about how to make this transi-
tion? It would seem that most leaders-leaders like us who have been
conditioned to exercise command-and-control but who see the value in
OL-would have to undergo some kind of major transformation in order
to participate in OL. Remember what Phil Carroll a t Shell said.

Phil: The executive leader has to start with him- or herself.

I think executive leaders can make that transition, but it is a
process and it takes time. I don't think any of us make a transi-
tion from being a dictator today to being Mahatma Gandhi in
five years' time. It's more like a journey in which you have a gen-
eral direction, which is the desire t o devolve power and decision
making down into the organization.

Bert: Phil would agree with you, but I'm not so sure. I agree whole-
heartedly with the need t o devolve power. It's a matter o f degree.
Regarding the need for personal transformation, it's a question o f how it
happens. I thought Peter Senge's view was you had to go through per-
sonal change-then you could lead. I understood that t o be a sequential
process. Now I see that it isn't sequential but concurrent. Both the leader
and the organization transform incrementally as the journey progresses.
h a : In my view the process is both sequential and concurrent. It
begins with an awakening. Whether it comes by way o f discovery or dis-
aster, something sets you on the path. So we are not in total agreement
on this point. Is there a way we can talk about this transition in a way
that would be helpful to others?
Bert: We should try.
210 Part 3 / Leadership

Learning Leadership: A Debate

Iva: Let's review the argument. We agree that there are two major chal-
lenges facing leadership. The first is the challenge of transforming our orga-
nizations, which involves developing appropriate leadership capacity with-
in our organizations.
Bert: Which can require a major effort.
Iva: That first challenge begins with a question, again as Phil pointed
out.

Phil: When I run up against a question like: "How do we

build leadership capacity in the company?" I can't call everyone
together and say, "OK, here are the steps. We're going to do this."
It's not that simple. Finding the answer to that question is a
process. It's almost a political process-and it's certainly a learn-
ing process in and o f itself.

Iva: That first challenge leads to the second, much more personal
challenge: How can I surrender control? For most traditional leaders the
path to transformation begins with that question. The good news is that
once you admit that you, the leader, don't know how to do this, that you
have no formula, then, by definition, you are on the way t o a new form of
leadership. First you admit it to yourself, and then you admit i t openly.
Bert: But if you admit that openly, you may invite danger. The orga-
nization may not be ready for a leader who doesn't know. There can be a
backlash.
Iva: That shouldn't stop you-if you are really committed to this
work.
Bert: That's spoken like a true visionary.
Iva: You're right, Bert. O f course that is the visionary aspect of me
speaking. But don't give up on me. I really have learned some things from
you, so let me be clear. I have spent the last several years engaged in a
process o f double-loop learning. I have had to come to terms with the
fact that I can have a deep personal commitment to ideas, but my
actions may have to be more pragmatic. I realize that if I'm too much o f
a zealot, if I push the organization beyond the limits of its tolerance, I
won't be around t o make change. That means I must deal with current
reality as it is, on its own terms. It means that I stand on the razor's edge.
I have to pick my moves carefully.
So, you are right in one sense. If I, as a leader, can't openly admit I
don't know something without shaking people up or destroying my own
credibility, then I must consider whether there is another way to engage
others in answering the question that is more acceptable to the organi-
zation.
 Chapter 10 / Reflections on Leadership 21 1

At the same time I must recognize that I may just be assuming that
I can't admit that I don't know. It may be that a lot of people are des-
perate for the leader to admit that he or she doesn't know something. So
I have to find some way t o test my assumption. Otherwise I'm just cop-
ping out-because I'm scared or because I actually like being the leader
who knows and I don't want to let go of that. We have all kinds of ways
of kidding ourselves.
If we believe in this learning idea and we want to change our orga-
nizations for the better, we have to make conscious choices about how
we're going to work within the context of the present even as we're help-
ing t o birth the emergent systems. That's not easy and it may involve
compromise sometimes, but none of us should be in the business of com-
mitting career suicide because i f the enlightened leaders are no longer
around t o lead, then this effort has no viability.
Bert: Thank you. I especially agree with the last part o f what you
said; the rest I'm taking under advisement. I'm just a little reluctant t o
say that all leaders have to undergo some kind of earth-shattering per-
sonal transformation t o do this work. However, they will most likely need
to learn some new skills.
Iva: Learning new skills is important, yes, but it's also more than that.
Think about how Phil described his journey:

Phil: For many, many years I had worked hard to have a very
pronounced separation between my home life and the office. My
wife and kids would be over here, but when I went out in the
morning and started the car I thought to myself, "You better put
your game face on, you're a different person. You're going to act
differently." Then when I came home, I tried to take that face off
and be another kind of person.
All that is very false. In the long term, that behavior pro-
duces unacceptable strains in both places. You're not an inte-
grated person. You're not a whole person. And if you're not a
whole person it's very difficult to lead others effectively. I had to
come to terms with that, and it was not easy. But, with help
from some consultants in OL and other areas, I began to see that
everything that happens to us has an emotional element and
that t o ignore the emotional aspect o f things completely is not
h ea Ithy.
I also came to see this drive to compartmentalization with-
in context. I began to understand why it was such a powerful
drive. We have built very powerful defense mechanisms and pro-
tections because it's an area that is not well-understood, espe-
cially for the technically trained. It's much easier for us to stay
212 Part 3 / Leadership

within the boundaries of Aristotelian logic and say, "Hey, you

know, this is about engineering principles and economics, and so
f o rt h ."
So we have this basic understanding. Most people say,
"Don't go there. I don't want that because that is going to
expose an awful lot o f me that I don't want exposed." We col-
lude in protecting each other from healthy personal develop-
ment, and that is a very bad characteristic.
Now, o f course, you don't want to overcompensate by going
in the other direction. You don't want emotions out of control,
with people tearing their shirts in the board room and ranting
and raving, but I'm talking about the skillful acknowledgement
of the emotional aspect of things. I'm talking about practicing
the ability to say, "Bert, let's face it, you're making me very
angry. I don't like the way I'm feeling about this. Irrespective o f
how logically you put your argument, I think you've got another
agenda and here's why."
You can learn those skills. You can practice in small groups.
I believe that these skills are essential if you're going to do any-
thing akin t o really building coherence and cohesion a t top man-
agement levels. People have to be able to have those kinds o f
conversations.
The compartmentalization we have practiced in the business
world for so long produces severe difficulties and limitations in
our ability t o think and act. So, in sum, I believe that this OL
work is about integration. This work is about reintegrating what
is segregated or separated out in our mental processes-such as
separating emotion from reason and separating home from the
office. That's the essence o f it.

Iva: I relate to what Phil said because as I began this OL work I came
to realize that something had happened t o me on the road t o upper man-
agement. I had adapted t o what was required o f me and as a result I lost
touch with myself. I have come to question whether compartmentaliza-
tion should be eliminated from business. In fact, I question whether it's
good for business even though, a t present, we accept that it is.
Bert: I understand what you are saying, but that's reality. The busi-
ness environment still requires us to compartmentalize-to separate feel-
ings from logical thought. We put them in a box. Some of that may be
necessary. There is a proper role for defense mechanisms, business per-
sona, the mask, etc. Again, it's a matter o f degree.
To my mind there are t w o levels o f integration: the integration o f
personal and business life and the integration o f logic with emotions.
With regard t o the latter, my concern is that the road to integration is
 Chapter 10 / Reflections on Leadership 213

inherently unstable. Do we really want to take that on in the workplace?

It exposes us to the risks involved with having outbursts of extreme emo-
tion. This could undermine performance. For example, what happens
when people's emotions run high? They aren't on "receive," they're on
"send" only. They lose objectivity; they say things they don't mean or
expect-including me. It's harder to be productive. I don't believe that
good leadership lets that occur. The leader has to have a sense of when
an emotional issue needs to be taken off the table and dealt with later.
I also believe that a leader has t o overcome their personal emotions
and doubts in order to provide the necessary leadership. When people are
under a strain they look for a pillar, a rock, an anchor. That is a require-
ment for those who are responsible for leading people into battle. People
expect their leaders to exhibit confidence and to maintain a positive
demeanor. Churchill was a great example. People don't want a leader to
look scattered or display too much emotion or expose their uncertainty.
In fact, that's crucial to my concept o f leadership.
Iva: I'm struck by the military analogy you just used. Although I
agree with you, I trust that business is not war. I also agree that in the
current reality o f our business climates, compartmentalization is still
highly valued. But during this important transition phase leaders must
begin to come to terms with whether or not compartmentalization is
really benefiting our organizations. Is it really making us better leaders?
And, if not, what actions do we wish to take t o change things? And do
we have sufficient trust and commitment to begin this process?
Many will struggle with these questions because we have been so
conditioned by the business culture t o behave in certain ways. Just as we
ourselves have had to unlearn some o f these conditioned responses, so
will others.
Bert: Maybe it's a question of how far you want t o go with organi-
zational learning. If you're mainly interested in improving the organiza-
tion's ability t o do single-loop learning, then I don't think you'll have to
go as much into yourself. But if you and the organization want to prac-
tice what we're calling a deeper form of organizational learning, then
that's another story.
Iva: That may be one way to think about it. Maybe there are degrees
o f commitment that a leader can make to organizational learning. It's a
question of whether you want t o commit to developing the capacity for
Model II actions. If you do, then you have to be willing t o go wherever
that path leads you. If it requires a deeper level o f questioning and per-
sonal transformation, then so be it. But i f you're going to make a limited
commitment to OL then I believe that you have to do so with the full
understanding that your commitment is limited and you're not going to
realize the full benefits.
Bert: Maybe you're not ready t o make that full commitment in the
beginning. But if you're willing to do something, that's got t o be OK.
214 Part 3 / Leadership

Iva: Alright, let's say t h a t you can only make a limited commitment
in the beginning. That's still going t o require a major transition on the
part o f most leaders because we've learned that you can't lead a learning
effort in the same way you've led other kinds o f efforts.

Keeping Your Balance on the Walk Between Worlds

Bert: So you're saying that leaders may have t o learn how to stop lead-
ing as they have led before.
Iva: Yes. Let's think o f leadership as a continuum. A t the one end we
have traditional command-and-control style o f leadership. A t the other
end we have the leadership that's necessary in order for organizations t o
learn. We've been calling that "collaborative leadership."

Figure 10.1
Leadership Continuum

Command-and-Control Collaborative

Bert: So, you are saying that people who want t o be OL leaders must
move away from command-and-control; their leadership style needs t o
become more collaborative.
h a : Yes. I believe t h a t many positional leaders, like ourselves, will
understand on an intellectual level what OL leadership entails, b u t they
will struggle w i t h this transition, because they have been so conditioned
by the business culture t o behave in certain ways.
For example, there's a danger t h a t command-and-control leaders
will suddenly switch gears and try t o act like servant leaders.' That will
confuse the people in a traditional command-and-control organization.
The people in the organization won't know whether t o trust that the
leader has really changed-and they won't be ready t o accept more lead-
ership responsibility themselves. That's when fear and anxiety are likely
t o show up because people think it's a setup.
Bert: So there's the problem o f delay. As people begin t o see a
change in leadership it will take them time t o believe and trust in the
change. A t the same time the leader him- or herself will go through an
internally frustrating period. The uncertainty and questioning t h a t occurs
on both sides will cause these delays.
 Chapter 10 / Reflections on Leadership 215

Iva: Yes, indeed, Bert, repeat behavior over time is needed before
people trust that it's real. There's a delay while the leader is changing
mental models and learning new behaviors. In moments o f stress, there
is a tendency for old habits t o take over. They'll slide back to using their
old command-and-control tactics. I know; I've done it.
Bert: There's also a danger that leaders who have been conditioned
to be command-and-control will overcorrect and become too reluctant
to act. Remember how Bill O'Brien characterized it.

Bill: You asked me what kept me up a t night? It was when I

had t o deal with poor performance. I said t o myself, "If I'm going
to do this I'd rather take a little more time and do it too late than
do i t too early because I have a human being's life here." Finally,
you get signals that tell you you've waited too long. Some of
your direct reports are coming to you, trying to drop hints that
information technology is not working. And there are missed
deadlines-a whole host o f things. I erred by being too late. I was
late partially by design because I wanted to minimize the fear.
For the most part the fear in corporations today is very debili-
tating so I wanted to keep us a t a very low level o f fear. I would
rather have a lot of other people say, "It's about time O'Brien
woke up!" than having people say, "Where is O'Brien going to
strike next?"

Bert: That happened t o me as well. But back t o your continuum.

You're implying that leaders have t o somehow go through a transition
process that moves them on that continuum from the left to the right.
I'm not sure that I believe this. I have a very different mental model o f
leadership.
We have a tendency in this field to take a kind o f moral position
against command-and-control and that's wrong. Good leadership is
highly situational Positional leaders have to retain the capacity to use
command-and-control tactics when necessary even when they're prac-
ticing OL.Rich Teerlink gave us a good example, which we talked about
in the last chapter. When he sent his two managers to resolve the prob-
lems in the plant, that was a great example o f using a command style to
accomplish a goal that was congruent with learning.
Iva: Rich knew just how to respond t o the situation t o get the most
effective-and also learningful-outcome. He used his command author-
ity to force the two managers to learn how to work together. He wouldn't
let them divide up the work, which would have meant they'd come from
the old reductionist paradigm. And he wouldn't let them resort to com-
mand-and-control to solve problems.
216 Part 3 / Leadership

Bert: The ability to "read" a situation and t o respond appropriately is

a critical skill. I'm calling it "situational acuity" and I believe it's an art.
Iva: It's particularly artful because he wasn't just resorting t o com-
mand, but doing so in order t o promote learning.
Bert: I can see myself doing the same thing. Even though I'm com-
mitted t o OL, I will intentionally go back and use command-and-control
if I think I have to. Does it break me up inside? Sometimes. But it's not a
question o f going backwards in those cases. It's a question o f making
conscious choices. Many times leaders find themselves in situations
where there are a lot of conflicting demands. The question is, how are
you going to resolve them within the context o f your management style,
your values, and your inherent sense of what will work in that moment
given your boss, the financials, the customer base, Wall Street, etc. One
puts all that in the pot, evaluates it, and says, "I'm going to do this."
That's what leadership is all about.

The Debate Intensifies

Iva: Let's hold that idea for a moment and examine it. The idea of sit-
uational leadership has been around for a long time.* If OL leadership is only
a matter of applying a form of situational leadership, what are the implica-
tions? What, if anything, is going to be different? What's the difference
between a leader who thinks they are "enlightened" but decides that they
are being "situational" when they practice command-and-control-and a
leader who is just being inconsistent-or who is just plain reluctant to sur-
render control?
Bert: You're right in the sense that this kind of situational leader has
t o be more sophisticated because organizational learning is now, in fact,
a viable option for a situational leader. He or she has a more robust set of
tools to choose from. Now it's not just a question of: Are you a Theory X
or Theory Y manager? Now it's also: Do you question your assumptions?
Still, it's not inconsistent for leaders to go back and forth between the
two. The folly is in taking one position on either extreme. If you choose to
be the OL guru, then you are equally as misguided as a person who
chooses to be command-and-control most of the time. When I see some-
one who is extreme in either direction, I get concerned because that's a
one-dimensional manager. I'm also trying to get the issue o f morality out
of this. There is value in the heroic leader. There is a time when you have
to take distasteful actions in order to get your financial bottom line
aligned with expectations. You can make as much progress with com-
mand-and-control as you can with OL, under certain conditions.
Let me describe a scenario. If I come into a Greenfield situation I
have more degrees of freedom than if I come into a company that's in
trouble. In the latter situation, my first priority is to get us out o f trou-
 Chapter 10 / Reflections on Leadership 217

ble. I may believe that I have to act quickly and decisively and don't have
time to build the capacity for more participatory decision making. But
say I've been hired as the new CEO o f a company. Say my predecessor
was let go because of poor performance and I'm coming in from a very
successful company. My mission is t o turn the situation around. Because
of my knowledge o f OL, I have a broader range of choice: I can choose t o
shake things up, which is what everyone expects, and lay on the formula
that worked so well a t my previous company.
Or, if I'm really committed to learning-and I think that I have the
time and enough of the essential ingredients and I'm willing to take on
the risk-l can try to bring everyone together, discuss the mistakes of the
past few years, and do some double-loop learning. Based on what we dis-
cover together, I can then utilize everything I know about OL to develop a
change strategy. Two choices. You make the best choice you can, given
all o f the circumstances. And you may not choose to take the learning
approach even though you are committed to OL. Successful leaders will
each choose their own mix of command-and-control and collaboration,
so there's no formula. It's an art. That's the learning challenge: to know
when to do what in what direction. That understanding will only be built
up as more people go down this road and explore it.
Iva: Let me try to answer you by using the metaphor o f a high wire.
The high wire stretches across the chasm from command-and-control to
collaborative leadership.
Bert: You, as a leader, are riding a unicycle on that high wire, mov-
ing back and forth between the two.

Collaborative Leadership
Figure 10.2
The Tension System
21 8 Part 3 / Leadership

Iva: Here's where you may be missing an essential point, which is:
You're not just oscillating back and forth. As Phil said, "you're moving in
a general direction." You're heading somewhere. That means that you're
heading away from command-and-control and toward greater collabo-
ration. You may occasionally draw on command-and-control tactics, but
in fewer and fewer situations. That ceases t o be your fall-back strategy.
In general, you're moving to the right, toward more collaboration.
Here's why I believe this. I believe that there is a bigger danger than
the danger of throwing out command-and-control altogether and that
danger is that nothing will change. Leaders have been practicing so-
called situational leadership for a long time. OL changes the game.
Positional leaders now must face the challenge of developing their own
leadership abilities so that they can effectively practice leadership in an
organization that is learning. That's different. It has to be.
Therefore, if we're going t o use the term "situational leader" in this
context we have to define what we mean by that. We have to define
what it means in the context of learning. We have to bring learning into
the equation. It's fine to say, "Be situational," but the meaning of situa-
tional leadership has now shifted. The ability to be situational in a learn-
ing context means that you have to take the time and develop the capac-
ity to challenge your assumptions and reflect deeply enough to get some
double-loop learning. Otherwise, you may respond to situations differ-
ently, but your response could be the result o f Model I reasoning.
Furthermore, we are beginning to understand that "control" as we know
it now is an illusion. So we can command, but we can't really control-
even in the present system. Perhaps you're struggling with the idea of
surrendering con t ro I.
Bert: Let's stay with our analogy. As a leader, your job is to stay bal-
anced on that high wire. You're in a tension system and you have t o stay
within the elastic zone of your tension system. If you exceed the bound-
aries of that elastic zone, something's going to change and deform per-
manently. You'll lose your job or you'll choose to leave. Each leader will
have to figure out where those boundaries are.
Iva: And on the other side you've got the vision and values that you
want t o live by and enact: the principles o f organizational learning.
Bert: So as you balance on the wire you're trying t o balance the
requirements of the present system with the ideals o f the emergent sys-
tem. For example, I generally make a distinction between a leader and a
manager, but when it comes to this work, a leader must also be a man-
ager. Change itself is a process that needs t o be managed. So besides
providing an environment where learning can occur, the leader has the
responsibility as a manager to ensure that the results are forthcoming.
Therefore, the decision whether and when to start a learning effort
becomes a major management question. For example, the organization
may need to get its financial house in order first-whatever that takes.
 Chapter 10 / Reflections on Leadership 219

A leader may be able to inhabit the dual role of leading and manag-
ing the change process, but it's difficult. Leaders may have to choose to
separate leadership responsibilities from operational management
responsibilities. However, both are fundamental to a successful learning
effort. The effort must stay grounded in present-day realities and expec-
tations or it may lose relevancy.
Making those kinds of decisions is situational leadership to me.
When you're sitting in a divisional or team meeting or in an executive
committee meeting, chances are you're not expected to be sitting there
as a leader of an OL process. You're going to be sitting there as a finan-
cial custodian.
Iva: You're both and you have to learn how to hold both, how t o stay
in that paradox of evolving to OL and maintaining existing performance
levels. I don't think compartmentalization is the answer here. You have
t o be both. That doesn't mean you do i t in a way that would damage you.
You have to dance with it.
Bert: So you're up there trying to stay balanced. On the one side
you've got all of the pressures and demands of current reality. You've got
financial and performance responsibilities that you need to manage,
you've got political issues, people jockeying for control and power, and
maybe you've also got resistance t o change. How do you stay balanced?

Balance and the Walk Between Two Worlds

Iva: Staying in balance will be a challenge-as we both know from our
stories. It's a paradox again. For a lot of people who've come up through a
hierarchical structure and raised themselves up on the ladder of influence,
coming to OL can be like suddenly seeing the light. You think that maybe
things should be done differently in order to be more successful, but abrupt
change isn't going to work.
The moment you make an abrupt move, you fall. So you have to be
able to stay in that conflictual space. It's very important to honor the
other system, give it space to exist, because the moment you start trying
to dismantle it, it's going t o push back. So it's not about saying, "I've just
seen the light and now we're going to do things differently. I've just been
to this training course and now we're going t o implement this in my
organization and if you don't do what I say and want, you're not going
to be able to create that which is possible." Which, of course, is what I
did, in the simplest of terms.3
Bert: One has t o remember that as a leader you're responsible for the
well-being of many other people who may not yet understand the
change you're trying to bring about.
220 Part 3 / Leadership

Collaborative Leadership
Figure 10.3
A Leader's Responsibility

Bert: I like the way Rich talked about a leader's responsibility.

Rich: My Dad taught me about leadership. When I became

a supervisor, he said, "Richard, your whole life changes now
because from now on you're not only responsible for you and
your family, you're responsible for those who work with you and
for you. You are the most important person in the world to them.
You determine if they have a job, you determine if they get a
raise. You are the decision maker about everything that's really
important t o them. If you have credibility with them, then they
don't worry because they know you'll communicate with them
about what's going on."

Iva: One has t o be able to hold this vision but also recognize where
others are. Most everybody else is in the current reality of the existing
system so the work is t o build the bridge between the two. Building the
bridge involves being sensitive to the past, being sensitive to the culture
you're in.
Bert: So, staying with the analogy, when you are balancing on the
wheel, you're using feedback, i.e., the data that's coming back t o you,
very effectively. That's why you can maintain your balance. So there's one
 Chapter 10 / Reflections on Leadership 221

more aspect to our leadership picture. When you use feedback, you've
got the equivalent of a balance beam.

Collaborative Leadership
Figure 10.4
Using Feedback to Stay in Balance

Iva: That's why it's very important to understand and create appro-
priate feedback loops.
Bert: Also, we need to remember to design and pay attention t o
more than one kind o f feedback. There's the feedback that tells you how
you're doing in terms of the results you're supposed t o deliver and also
the feedback that tells you whether you're getting resistance. If you get
feedback that tells you to stop or go slower, or take a detour, you need
to listen.
Iva: Then there's the kind of feedback that tells you how you're doing
in your personal transformation process. As Chris Argyris has observed,
we're very likely t o espouse one set o f values but then operate according
to another. That's when we get into trouble and create confusion for oth-
ers. How does one know if one's actions are in contradiction to one's
espoused values when one's employing situational leadership? Feedback
will let you know. That's why it's important in the beginning to clarify the
value system you want t o operate by. Are you trying t o develop your
222 Part 3 / Leadership

capacity for Model II? Because that will guide how you instruct people
about the feedback they should provide. So a leader may need to find a
coach.
Bert: At the very least you need to find people who will tell you the
truth about yourself and about the situation. That's hard to find! In my
case, I used my boss as "air cover" because I didn't trust myself to be able
to read the signals. He wouldn't run interference for me, but he would
tell me if I was going off-course.
Iva: While I, o f course, ignored the signals that people were trying to
give me. That's why there's another tool you need besides feedback. You
need the capacity to reflect on the feedback you receive and the ability
to learn from your reflections.

Leadership, Reflection, and Action

Bert: Reflection, let alone reflection in the midst of action, is very dif-
ficult for most traditional command-and-control leaders. We just don't
have any practice in it. Personally, I resist it because I just don't think I have
time for it.
h a : Ah, that's one of those traps that we create for ourselves. Better
to have a mess o f short-term fixes than face the prospect of stopping for
a moment to think more deeply about what we are doing.
Bert: It's very easy to say that, but in the moment the quick fix sure
looks like the right thing to do. Taking time for reflection does not-even
though I see the logic. It's that dual system problem again. You have to
make a choice in the moment: do I go with the vision or the practical
rea I ity?
Iva: Dave Marsing has a wonderful perspective on why reflection is
practica I.

Dave: If you don't reflect, you don't see the openings and
the opportunities. Without the period o f reflection, there's more
and more tension and pressure put on your cognitive processes
in order to be successful and t o accomplish your objectives, so
that sometimes you're blind to an opportunity that might be
tangential.

Iva: Thinking about the importance of reflection brings up another

kind of balance that leaders need to have. We need to be able to balance
action with non-action. That feels like another paradox because we can't
believe that we don't need to act to move the process forward.
Bert: As a Type A, I have time urgency. I have a hard time dealing
with the delays involved in OL. I tend t o want to act. The truth is, I run
out of patience with the collaborative process and therefore I tend to
 Chapter 10 / Reflections o n Leadership 223

revert t o command-and-control, whereas Rich Teerlink seems to know

instinctively how to read the situation and how to balance action and
inaction. He is a real role model for me.

Rich: The delay (before the effect o f learning can be quan-

tified) is longer than you would ever anticipate. But you also
have to be careful of creating too high a level o f expectation.
That's why it's good, I think, to just talk about something. And
then let it simmer and evolve a little bit.

Bert: Rich seemed to be able to balance the forces without neces-

sarily imposing his own will. And he didn't take it all on his shoulders.
Iva: Until about two years ago, I would always revert t o pushing for-
ward when things weren't going as I felt that they should. Then I learned
a powerful lesson. I saw that that behavior-which I thought was so suc-
cessful-had actually caused many difficulties in my life. I could see the
connection clearly. I have had so few opportunities to practice this new
learning, but when I did the outcomes were great. So the only thing I
long for is more opportunities t o practice what I learned. The trouble is,
we've created these systems that reinforce acting for its own sake. Yet,
we would never agree that that is so.
Bert: The closest I've come to being able t o balance action and non-
action has been in cases where the problem went away on its own. I have
this sixth sense that tells me when problems will fade or resolve them-
selves. When the sense shows up I try to listen to it, because when I over-
ride it I don't have the courage o f my own convictions.
Iva: Most of us can let problems go away, at least to some degree.
But letting things unfold is different. And knowing when not to act so
that things will come out better than i f you did act is difficult. I wish I
had more practice in letting go, having faith in the flow of things, and
realizing that we're not the center o f the universe so we don't have to
make things happen. We become so self-centered-not in self-interest,
necessarily-but in believing that we alone can do it. Do we often take
action in spite of the fact that we sense that we should do otherwise?
Perhaps we do so because we haven't had the experience o f another way
of getting t o an outcome.
Bert: Action pacifies anxiety. We want to get in there and do something.
Yet, at the same time, management tends to be reactive. That may be why
so many businesses are crisis-oriented, Until actually faced with a crisis, we
tend to be inactive. A crisis gets us moving. We put ourselves in danger so
that we can do something. All organizations would be learning already i f we
were committed to acting prophylactically rather than remedially.
Iva: Sometimes we create the crisis in order to change our behaviors,
to do the right thing. I have done that even with OL. So we in business
224 Part 3 / Leadership

are reactive rather than creative. We are prone t o action without reflec-
tion. And we are addicted to crisis. Is this what we really want? I would
put this as a preeminent question.

A Question of Personal Mastery

Iva: There's one more aspect to holding the tension that I want to bring
up. In order to incorporate feedback-especially criticism-and to really be
reflective, we have to achieve a certain level of personal development, what
Senge calls "personal mastery." Now that's a little circular, because I think
that feedback and reflection can help us to achieve personal mastery. But
we have to have the openness and the willingness to learn about ourselves
to begin with. That takes a certain amount of self-awareness and even
courage. I don't think I had that a t the beginning-although I very much
wanted to. So I still think that it means that organizational transformation
requires starting with yourself. It always comes back to yourself.
Bert: I don't believe that OL requires that you have a cathartic
approach to your life.
h a : I can't prescribe what's right for anyone else-but I would also
say that you can't preclude that if that's where your learning journey
leads you-as it did in my case. If you resist the idea, you might want t o
consider why that's such an important boundary condition for you. Just
hold that as a question. If I as a leader act in certain ways that have been
accepted and forgiven or ignored because I am who I am, I have the
responsibility to change those things.
Bert: I guess it depends on what your assessment o f triage tells you.
If you think that working on yourself will jump-start the change process
for the whole organization, fine. Go ahead. If it's perceived that you are
the problem, then you need the change. But my sense is that you pro-
ceed more by feeling your way together a t the same time, learning to
master the leadership profiles that your group both needs and is capable
of delivering.
Iva: We may not agree on everything, but we do agree on the need
for leaders to hold the tension characteristic of every paradoxical situa-
tion. So too for the OL leader. As you're leading you'll constantly be mon-
itoring for feedback and then reflecting, learning, reframing, and finding
another way of thinking or acting that may surprise you.
Bert: That's why Dave related it to learning a martial art. It takes
practice and time t o master this balance.
Iva: Maybe a lifetime.

Failure: The Leader's Learning Edge

Iva: So we're saying that if a leader wants to stay in balance, they need
some tools for assessing and coping with that tension system. They'll often
 Chapter 10 / Reflections on Leadership 225

have to make a choice between OLvalues and the values of the existing sys-
tem; between commanding and collaborating; between acting and nonact-
ing; between results in the short term and the long term. The journey will
require patience, preparation, and flexibility. And they will no doubt make
errors because they're learning. When they make a mistake they can use
double-loop learning to understand what happened.
Bert: Even then, they might fail. If so, how will they deal with that?
The way we deal with so-called failure in business always makes me
think o f how we as parents react when a little child first begins to walk.
The child usually takes a step or t w o and then stumbles and falls down.
What do we do? We applaud, we give them all kinds of support and
encouragement. That's probably the last time any of us ever experiences
that kind of love and reassurance for what was, essentially, a failure. We
have t o change both how we define failure and how we treat failure.
That's also leadership's role.
Iva: The reason we applaud when they stumble is because we
acknowledge that they have taken a risk in the direction o f growth.
When they grow up we say we want them t o take a risk, but when they
stumble or fail we punish them. As a rule, today's leaders don't deal well
with failure-either someone else's or their own. Dealing with failure is a
learning edge for most leaders, a challenge that often catches us
unaware. It's very hard for people who have come into the upper levels
of management t o deal with failure because when you're very successful
and when you're creating that which you wanted and hoped for, you
become more confident in your ability to master any challenge. In fact,
you rarely question your mastery. Then, when something happens that is
not expected-a failure-it doesn't fit into the mental model you have of
you rse If.
So how do we cope? Good old Model I. We look for the external
influences that created the situation, we question other people's motives
and abilities, we blame others. We blame circumstances. M y experience
in the corporate environment is that we are pros a t explaining away fail-
ure, but not very good a t learning from it nor at having compassion for
each other when we do fail. We still have a lot t o learn.
Bert: Yes, there are some people who immediately look for reasons
outside themselves. They say the environment was lousy, or it was the oil
crisis or something else. But when I fail I tend to blame myself first. I feel
devastated persona I ly.
Iva: That's the flip side of the same issue. In both cases we're dis-
playing an inflated sense of our own capacities, a trait that's not uncom-
mon in executives. The first response is like saying, "I'm responsible for
nothing," and the second response is like saying, "I'm responsible for
everything." If you think about it, neither one is a really centered response.
When you thought you failed, Bert, what did you do differently?
226 Part 3 / Leadership

Bert: I tried to learn from my mistakes. I became more reflective and

I changed my approach.
Iva: But you didn'tchange the way you thoughtabout failure. Neither
did I. I believed my own story. I believed that nothing was going wrong
and I certainly didn't believe that I was responsible for any of the prob-
lems I was having. So I repeated my mistakes until I really failed. I had a
lot more t o learn about how t o create conditions so these patterns
wouldn't repeat.
Bert: I like what Dave Marsing said about how to deal with failure.

Dave: I used to deal with failure very poorly-but I've

learned. At this stage of my life, when those kinds o f events
occur I spend a lot o f time reflecting on the big picture. I also
spend a lot of time working through my immediate emotional
reaction. I try not to take it as a personal failure
I also realize that there are a lot of times when failure is cir-
cumstantial. It's not because I had the wrong intentions or that
I'm totally unskilled or a total idiot or I blew something. Instead
I open myself up as much as I can to be receptive to the objec-
tive learning that lies somewhere within. And I try to get as
much value out of i t as I can.
Also, I'm much more concerned about the impact of the
experience on those around me because most often this has
been a team effort, therefore a "failure" affects more than just
me. I try very hard to mitigate the suffering of the people around
me and to help them work through their interpretation of what
it means.
Taking the time and having the skills to be able t o reflect
were essential t o my developing the ability to understand and
cope with failure. If you don't reflect, you don't see the openings
and the opportunities. Without the period o f reflection, you put
more and more tension and pressure on your cognitive processes
in order t o be successful and t o accomplish your objectives.
Sometimes that means you're blind to a new opportunity that
the failure might be bringing forth.

Iva: If you don't know how t o reflect you will not be able to do this
work, and if you don't do this work, you will not know how to reflect.
Bert: That's a learning edge for me. As I look back, I was always pretty
focused on getting it right instead of seeing new opportunity in the fail-
ure. That'll take some practice.
 Chapter 10 / Reflections o n Leadership 227

The Lonely Leader

Iva: I feel that the picture we've painted of the leader may seem rather
lonely. Perhaps, because of our having been conditioned to be hero-leaders,
we've forgotten that, in the end, OL leadership is about putting aside that
lonely hero and enabling coleadership, shared leadership, collaboration. It's
about creating networks of people who share these ideas; it's not about
being a lonely martyr to the cause.
Bert: If I were being idealistic I'd say, "Absolutely, yes, you will be
able to find kindred spirits and you will not have t o go i t alone." But if I
were being realistic I'd have to say that I'm not sure that it isn't going t o
be lonely in practice-at least a t the beginning. At the same time I'm
willing to admit that I probably didn't reach out enough t o people. The
irony is that if I had it t o do over again, I still might not know how t o do
that.
Iva: So there's something else we leaders need to learn more about:
how to engage with and cocreate with others.
Bert: And give up the idea that we have to do it all ourselves.

What i f Your Organizational Learning Effort "Fails"?

Iva: There is some risk and we have to acknowledge that not many OL
leaders have been able to accomplish everything we've described.
Bert: That's true, but this is a journey. Even if you "fail" in one sense,
you will have succeeded in the more important sense because you'll shed
more light on the path. You'll have learned one more thing about how to
bring this change about, so that others can continue.
h a : And perhaps you'll have changed yourself.
Bert: Bill O'Brien may have said it best.

Bill: When it comes t o viewing "failures," I take the long

view. I think of organizational learning as part o f a movement-
a very positive movement. Yes, there have been some very abrupt
endings to OL leaders, but for me, that isn't failure. It's the price
of a movement.
Those so-called failures have been part o f an efiormous
movement that's moving very rapidly away from the old bureau-
cratic, command-and-control structure. You can see the evi-
dence. Manufacturing organizations are light years ahead of
where they were ten years ago in this country both in terms o f
productivity and in terms o f dignity and respect for the worker.
They are now enlisting people's thinking capacity. Some indus-
tries, like the financial services, are behind, but it will happen
there, too.
228 Part 3 / Leadership

Theres been enormous progress since The Fifth Discipline

first came out, so the first casualties arent failures, theyre the
price o f a movement. If you want an analogy, just look a t WWII.
We dont say that Guadalcanal was a failure even though we lost
a lot o f lives. We say that that was the price o f freedom.

Bert: Now that may sound like a very strong analogy, but thats really
what were talking about here. Were talking about a kind o f freedom:
freeing the creative potential of people in the workplace.

Can traditional command-and-control managers learn their

way toward a more collaborative form of leadership? If we
believe the answer is yes,then how can they go about it? These
are the questions that Bert and Iva have been wrestling with in
this chapter.
As weve come to expect, Iva speaks for the vision, and Bert
speaks about the practical demands that tend to define present-
day management. We need to honor both of these perspectives
and find a pathway that both can walk. This is our collective task.
It belongs to all of us who struggle with these questions and we
can only offer some thoughts here.
We think that the starting point is a deep commitment to the
devolution of power. This principle applies whether one is an
executive or line manager, team leader or networker. A learning
leaders work is about skillfully giving away power, surrendering
control, and rendering capacity for leadership in others. The word
skillful is key here. The devolution of power involves letting go
of the reins in such a way as to free the potential for self-organiz-
ing networks to emerge. Ralph Stacey writes that self-organizing
networks are the structures that will enable an organization to
deal more effectively with complexity. These networks can and
should exist right along with the traditional hierarchical structure.
Staceys view is that the two systems (hierarchical and net-
work) probably should coexist simultaneously as one is good at
responding to predictive situations and the other is required for
dealing with the unknowable.4
If this holds true, then the transition we are talking about is
not necessarily about moving from one system to another, but
about living within and between the two, tapping into each as
appropriate. This is Berts situational leadership model taken to
another level of understanding. Again, Berts and Ivas perspectives
complement each other. Iva speaks about living with paradox and
about our ability to hold the tension that is required to stay with
things that seem to be in contradiction. Bert focuses on the need
 Chapter 10 / Reflections on Leadership 229

to stay balanced and to seek equilibrium, however momentary,

within that tension system.
How does one become skillful in devolving power? We believe
that for most command-and-control managers, some degree of
personal work is necessary in order to come to grips with this fun-
damental shift. Those who wish to embark on this journey would
benefit from a broad understanding of Argyris and Schons Model
I and Model I1 theories-in-use.5 With an understanding of these
concepts and of single- and double-loop learning they can hope-
fully make some informed decisions about whether and how they
want to proceed on their journey. That choice can also be
informed by an understanding of their own deeply-held values. A
sense of their present leadership style, perhaps informed by Rooke
and Torberts matrix, may also help to ready them.6
These tools can help define the territory of change. Then
comes the hard part.
If managers wish to undertake this journey, they will need to
seek support; it is doubly difficult for lone rangers to do this work.
While they can seek some individual training in the five disci-
plines, the real learning-the questioning of assumptions, refram-
ing, trying on of new perspectives and new behaviors-must hap-
pen through practice in community with others. This is true
whether the purpose is to develop leadership capacity or to define
a new strategy in the wake of complexity. As Stacey writes, learn-
ing in open-ended situations has to be a group process, not a task
carried out by an individual expert or visionary. N o one individ-
ual is likely to possess wide enough perspectives to handle such a
complex situation. Such perspectives can be developed only
through a group interaction.
We believe that a leader must reach out to others, must seek
feedback of all kinds and shapes-often deliberately creating
those feedback loops-and must work on their ability to reflect
upon that feedback. The leader may seek a coach, but should not
rely solely on a coach. If a leader feels too lonely in the learning
process, this is probably a signal that something needs to change.
How deep does a leaders work on personal transformation
need to go? The question seems unanswerable in the abstract. It
can only be answered by each within the context of his or her own
journey. This is a qualitatively different kind of journey for man-
agers. As Stacey says, in situations of open-ended change one can-
not specify an intention and then identify a limited number of
events and actions that will lead to fulfillment of that intention
because the links between cause and effect are lost in the com-
plexity of unfolding events.s
230 Part 3 / Leadership

If we follow Staceys argument, our idea of control changes.

The locus of control shifts. Today, we tend to believe we must hold
tight to the reins of control because if we dont we fear that all hell
will break loose. What happens if we question that assumption?
Stacey directs us to look at the evidence and to see how much in
the universe dances on the edge of chaos but does not fall apart.
If we can come to terms with that realization, we no longer have to
hold the reins so tightly. We can make free and informed choices-
sometimes choosing to control and sometimes waiting to see
what kind of order wants to show up. We have set ourselves-and
others-free.

Endnotes

1. Robert K. Greenleaf, Servant Leadership (Mahwah, NJ: Paulist

Press, 1331).
2. These concepts were first introduced by Paul Hersey and
Kenneth Blanchard in 1363.
3. Ralph Stacey, Complexity and Creativity in Organizations, (San
Francisco: Berrett-Koehler, 1336).
4. Stacey, 1336, op. cit.
5. Chris Argyris, On Organizarional Learning (Malden, MA:
Blackwell Publishers, 1333).
6. Excerpted from THE SYSTEMS THINKER Newsletter article The
CEOs Role in Organizational Transformation by David Rooke
and William R. Torbert (Waltham, MA: Published by Pegasus
Communications, Inc., 1333).
7. Ralph Stacey, Managing the Unknowable: Strategic Boundaries
Between Order and Chaos in Organizations (San Francisco:
Jossey-Bass, 1332), p. 112.
8. Stacey, 1332, op. cit., p. 167.
 Part 4
Mapping
F or organizational learning to become a viable option for busi-
nesses, we need many more practical experiments where OL
principles and methods are tried out in real business environ-
ments. These practical experiments can empirically test OLs ability
to bring about business results. Such experimentation can satisfy
our pragmatic need to know that these ideas work and that results
are replicable.
However, because organizational learning is also about heIp-
ing us to move into a new paradigm, we cannot be satisfied with
simple experiments designed to prove or disprove the efficacy of
learning solely within the context of our old paradigm. These
experiments can also help to surface and evaluate the deeply held
collective assumptions that inhibit our effectiveness and our abil-
ity to learn from our experience. The visionary within us knows
that assumptions can give rise to prisons of our own making, pre-
venting us from realizing our potential. These same assumptions
will also hamper our ability to learn from these experiments as
well as impede the more widespread adoption of OL. If we are to
break free from inhibiting and inessential assumptions we must
be able to question them openly and to discuss the implications
of their persistence. With more OL trials well have more opportu-
nities to surface our tacit mental models. Then we can ask, Do

23 1
232 Part 4 / Mapping

these assumptions serve us? To what extent are they artifacts of our
attempts to avoid fear and anxiety?
If we dare to experiment more, well also need to deeply reflect
upon, compare, analyze, and then share what we are learning
from those practical experiences. On the following pages we
review some of the key things we learned from reflecting upon our
learning journeys. We hope that they can guide you in designing
your own experiments.
We think of an organizational learning experiment as a jour-
ney. For us, that learning journey seems to flow into five natural
phases.
1. Inviting a Journey
2. Designing the Journey
3. Beginning the Journey
4. On the Journey
5. Journey Landmarks
In the next chapter we will try to bring those phases alive for
you, offering our thoughts and reflections on the key issues that
you may wish to consider at each phase. We invite you to reflect
along with us, hoping our thoughts might trigger further self-dis-
covery and further debate, urging you to adapt our thinking to
your own needs.
Chapter 11
The Adaptable Map

Why embark on a learning journey? Each person begins a journey

for a variety of reasons, many of which only become clear well
after the journey is begun. In fact, we often make up reasons later
to justify a journey, even to ourselves. Journeys beckon; we follow.
Remarkably, this appears to be true even in the highly rationalized
realm of organizations, as Bert and Iva can attest.
Journeys begin in the mind. As it happens, the pioneer of
modern exploration, Henry the Navigator of Portugal, never him-
self went out on an exploring expedition. As Daniel Boorstin
writes, the pioneer explorer was one lonely man thinking. So,
too, a learning journey begins in the mind.

Phase 1 : inviting a Learning Journey

The OL leaders we spoke with all come to a similar conclusion.
They saw that their organizations could not achieve their goals by
operating in the same way as before.
That awareness led to a vision of what could be. Rich Teerlink
had a vision of greater interdependence. Bill OBrien believed that
his organization could do materially better if they found a way to
free the untapped human potential. Phil Carroll had a vision of a
global organization based on a new structure and philosophy.
Dave Marsings vision involved responding to external demands
by developing the capacity of people to tap into their own potential,
to appreciate the diverse talents of others, and to work together
more productively.
Much has been written on the subject of vision and we do not
wish to repeat it here, other than to note a few reflections. Vision

233
234 Part 4 / Mapping

might start with one person but vision comes alive only in the
process of being shared and, perhaps, changed. Vision is more a
process than a thing, more verb than noun, more living endeavor
than done deal. It is probably healthier to have a generative con-
flict about vision than to have a single vision upon which every-
one seems to agree.
Second, we believe that vision is made more robust and ener-
gizing when it invites in practical considerations. The gap between
vision and the pragmatic demands of the business may provide a
rich area of inquiry. As George Bernard Shaw said, "You see things
and say 'Why?'; but I dream things that never were and say, 'Why
not?'" If the visionary can sit down with the pragmatist and seek
to understand the "why not, creative possibilities may emerge.
"

Third, vision seems empty unless it is embedded in values

and, as we have seen, values are at the heart of the work of OL
leaders. In fact, we may even say that values precede vision in OL
work. Vision is about where you want to go. Values are the context
in which you are operating; values define the rules and boundaries
by which you live on your journey. That's why it is so important
to attempt to align organizational values with personal values,
even though this is not always easy.

Bert: The danger is that we tend t o see the world in terms of the val-
ues that we think are good, but does everyone in the organization share
those values? For example, I remember that we used to take our con-
struction guys out to a fancy restaurant for lunch as their recognition for
doing a good job. One day one of the construction foreman stood up and
told me that they were very uncomfortable. They hated it. They felt like
they had to get dressed up because I was coming out. I took them out o f
their comfort zone.
Iva: It's so easy for us, as leaders, t o think that what we value is what
others in the organization value. M y relationship with the factory culture
taught me how important it is to value what others value. That's more
important than driving toward a homogeneous set o f corporate values.

Other qiiestions we may ask include:

Does this vision for my organization require a learning
process in order to be actualized?
If so, how can we articulate the connection so that others
can see the connection clearly?
If we can answer these questions satisfactorily then vision
becomes connected to learning. We have observed a tendency to
adopt "the learning organization" as a vision for the organization,
but we do not believe that that is ideal. The vision needs to emerge
 Chapter 11 / The Adaptable Map 235

organically from the organization itself. OL seems to be used most

effectively as a means, not an end in and of itself.

Assessing Current Reality as a Way of Inviting a Journey

Bert: It seems obvious that you'd want to start by developing an under-
standing of your current reality in some organized way. You could start with
a SWOT analysis. A SWOT analysis can help you determine the strengths and
weaknesses as well as the opportunities and threats that face your organi-
zation.
Iva: Each of the leaders we spoke to had come to some sort o f
assessment, though it may not have been formal. Phil Carroll's assess-
ment of his organization gives us a brief example o f what I mean.

Phil: There was a lot o f agreement that we had a substan-

tial need t o upgrade the financial and business acumen. There
was an enormous degree of risk aversion throughout the organi-
zation. There were also obvious difficulties with the sharing o f
information.

Bert: I think a SWOT analysis is a good starting point because it can

also help you identify the sources o f leverage for organizational change.
h a : Can you explain what you mean by "sources of leverage"?
Bert: I'll give you an example. One o f the things I thought about
when I was leading a learning effort was, How does change happen
around here? I came up with an assumption: Change had t o be either
data-driven or champion-driven. Those were the t w o fundamental levers
for change in our culture. Then I asked myself: What makes a change
sustainable? The answer was that it had to have a financial impact. So
my advice to others is that you have t o know what your culture values
are and start there because there's got to be a good fit between the OL
project you begin and the existing culture.
Iva: I can see how identifying those sources o f leverage could help
because you have to be artful about how much tension you introduce
into the system. If you don't find those leverage points you run the risk
o f rejection right away. I can also see that if you do a SWOT analysis
you'll come up with some assumptions. Those assumptions might be use-
ful in the beginning, but they also need to be open t o question and revi-
sion as you go.
Bert: That's true. A SWOT is a strategic tool-so obviously I have an
underlying assumption that you need t o strategize organizational learn-
ing, a t least to some extent, in the beginning. You need t o be savvy about
the political climate in your organization and you need to think about
how you are going t o play in that arena.
236 Part 4 / Mapping

Iva: That's very practical, but I'm thinking o f the other side. You
could also start your assessment o f current reality with Chris Argyris's
work. You could start by asking whether your organization supports
learning. Do people in the organization operate according to Model I or
Model II values? Are there defensive routines in place? Are people able
to openly admit t o and discuss mistakes and failures?
Bert: You can use some of the OL tools, such as systems thinking and
habits o f mind like inquiry, to begin assessing your organization's culture.
For instance, you might ask, How are decisions made here? You may hold
the belief that decisions are being made through consensus, but when
you start looking at how a decision was actually made, you may find that
decisions aren't really being made by consensus a t all.
Iva: As a guideline, you could use a framework like the one devel-
oped by Joseph and Jimmie Boyett where they contrast a culture that
supports learning with one that doesn't. (See Table 11.1.) This framework
is based on Ed Schein's extensive research.2
Table 1 1 . 1
Cultures that Enhance and Inhibit Learning
A Culture that Inhibits Learning A Culture that Enhances Learning

Task issues take precedence over relation-
ship issues.
Management is sorted into the "hard"
things and "soft" things, and the "hard"
things are considered to be more impor-
Leaders balance the interests of all stake-
holders-customers, employees, suppliers.
the community, and stockholders
Schein says that in a learning organiza-
tion 'No one group dominates the think-

.tant.
Leaders pay attention to the hard things-
data, money, bottom lines, payoffs, pro-
ing of management because it is recog-
nized that any one of these groups can
slow down and destroy the organization '
duction, competition, structure, and so
on.
Everyone pays lip service to the "soft"peo-
ple things and relationship stuff but the
real work of management is seen as that
which can be quantified.
People viewed by managers as another
resource to be used and manipulated like
capital and raw materials.

. Leaders and managers are engineers and

technocrats who are preoccupied with
creating and maintaining systems that will
be free of human foibles and errors
A key theme of the culture is designing
humans out of the systems rather into
them
Leaders and managers believe that their
people can and will learn, and value
learning and change Schein notes It
takes a certain amount of idealism about
human nature to create a learning cul-
ture
That idealism exists in full measure

People in the organization are reactive 1 People hold the shared belief that they
rather than proactive They change only have the capacity to change their environ-
in response to outside forces that are seen ment and that ultimately they make their
as threats own fate
 Chapter 11
1 People focus on solving problems rather
than creating something new.
= The organization is preoccupied with
short-term coping and adapting
1 Being "lean and mean' dominates the
thinking of leaders and managers
1 The idea of 'slack' is unthinkable
Work roles and tasks are compartmental-
ized and separated from family and self-
development
"Walls' and "chimneys separate functions
1
1 In solving problems people believe that
the best approach is to break the problem
into its components, study and fix each
component in isolation, and then synthe-
size the components back into the whole
Managers are presumed to have a divine
right" to information and prerogatives
Financial and other information is kept
from all those who do not have a 'need
to know '
Position and access to information confer
.
status and power
People sit on relevant information. put a
spin on things to protect their power posi-
tion. and sometimes actually lie to put
themselves in a better light
. Individual competition is perceived as the
natural state and the proper route to
power and status
There is a cultural bias toward ' rugged
.
individualism
The lone problem solver is seen as a hero
Teamwork is viewed as a practical neces-
sity but not something that is intrinsically
desirable
1 Leaders and followers assume that leaders
are supposed to be in control, decisive,
certain, and dominant.
1 Leaders are not allowed to acknowledge
their vulnerabiliy
This table is reprinted courtesy of John Wiley & Sons, Inc. It first appeared in 7he Guru
Guide: The Best Ideas of the Top Management Tliinkers by Joseph Boyett and Jimmie T. Boyett
(published by John Wiley, 1398).
/ The Adaptable M a p 237
9 This may be a necessary assumption for
learning After all, writes Schein 'If we
believe that the world around us cannot
be changed anyway, what is the point of
learning to learn Relax and make the best
of your fate '
1 The organization makes time for learning.
= Some "slack" time is not only allowed but
desired so that it can be used for learning.
Schein says, "Lean and mean is not a good
prescription for organizational learning."
1 People in the organization have a shared
belief that economic, political. and socio-
cultural events are interconnected and
that this is true inside the organization as
well as in the environment
There is a shared commitment to learning
1
and thinking systemically and to under-
stand how things work and especially the
consequences of actions over time
1 Managers and employees have a shared
commitment to open and extensive com-
munication
The organization has spent some time
helping people develop a common vocab-
ulary so that communication can occur
People have a shared commitment to tell
9
the truth
' share the belief that trust, team-
work coordination, and cooperation are
critical for success
1 Individualistic competition is not viewed as
the answer to all problems
' Leaders acknowledge their own "uinera-
bility and uncertainty
1 The leader acts as a teacher and steward
of change rather than a charismatic deci-
sion maker
238 Part 4 / Mapping

Cu It u ra I An a Iysis
Bert: Whatever framework or method you use, the goal is to come to
some understanding of how your organization can benefit from learning.3
Then the goal is to work with others to make that happen successfully. So,
it's a two-part assessment.
Iva: I don't think we've paid enough attention t o culture in this work
up to now. Edgar Schein has done ground-breaking work in organiza-
tional culture, but we seem to be resisting doing the work t o deeply
understand the culture of our organizations. If we want to take Senge's
approach and think in terms o f the five learning disciplines, a cultural
assessment is critical because some of the five learning disciplines are
going t o be more compatible with some cultures than with others. I've
learned the hard way that all five disciplines are necessary in order to
develop the capacity for organizational learning, but more technical
environments will respond better to Systems Thinking, for example,
whereas others will want t o begin with Dialogue. A cultural analysis will
help you t o become sensitized t o such things. Then you're more prepared
to consider how you can introduce the disciplines in a balanced manner
without introducing too much tension into the system. The question is:
How do you do a cultural assessment so that it's both robust and gener-
ative, rather than just accepting your own or others' untested assump-
tions about your culture.
Bert: I have to say that it's difficult to understand your culture when
you're inside of it. You tend to have a blind spot; you don't see what you
don't see.
Iva: Yes, that's a challenge, but I'd like t o suggest that this is where
collaboration becomes key. A cultural analysis is no small task. First,
you have to understand what "culture" means and what attributes you
are going t o use t o define your culture and its various subcultures. It
won't be easy and most likely you'll need help, particularly if you're an
executive leader. Despite the best intentions, it's very difficult for
executive leaders t o really understand the current reality o f their
organizations. It's hard for them t o get in touch w i t h how people think
and feel about difficult issues and challenges. I can attest t o that.
Therefore, it's important that this isn't a solitary assessment; you need
t o enlist skillful, experienced, trustworthy help. Still, as a leader, you
have t o make sure that that reflective mirror is being held up t o the
organization.
I don't have a formula for how t o come t o that understanding, but I
can a t least suggest that people who are considering leading a learning
effort spend some time with the following questions:
How is your culture likely to enhance or inhibit learning? What are
the strengths and weaknesses o f your culture?
How will your culture affect how you implement a learning effort?
 Chapter 11 / The Adaptable Map 239

Are you concerned with multiple subcultures? How do they differ

and how do they relate to one another?
How might you go about this up-front analysis? What resources
are necessary? Who should be involved?

Timing: A Question o f Readiness

Bert: I want to suggest that before you start you need to ask the sim-
ple question: Is the timing right for a learning effort? Answering that ques-
tion is going to call upon your pragmatic side. You have to determine
whether there is, in actuality, an opportunity for learning. Is the organiza-
tion really ready? If the answer is no, then you have to stop for now.
Iva: That's going to be tough, especially if you've already formulated
a vision. How do you suggest we evaluate whether the timing is right?
Bert: Ask yourself, Is this the right time t o introduce change? If
you're bleeding, fix things first. If you're about to get a new manager or
a new boss, it's not the right time. If the leadership is under total review,
it may be too big a risk. If you have just reorganized, be careful. If you
have new networks and relationships, establish your networks first
because you'll need them t o be in place before you take on a learning
effort.
You can assess whether the timing is right by asking a series of ques-
tions such as the following:
What is the relative financial health of your organization?
Is there a climate of openness and a receptivity to change?
Is there an opportunity for change such as a burning platform or a
Greenfield?
What is the natural heartbeat o f the organization?

Iva: Can we discuss why you put "relative financial health" as your
first question?

First Things First: The Debate

Bert: My argument is that you have to have good financial results
before you can begin an organizational learning effort. Without good finan-
cial results, you don't have the luxury of beginning an OL-based transfor-
mation effort.
Iva: Why do you believe that?
Bert: The OL leaders we interviewed said that i f they didn't have
financial results, they'd be shut down. I'm drawing the conclusion that if
you're in financial trouble t o start with, the first thing you do is triage
and stop the bleeding.
240 Part 4 / Mapping

h a : This is like a chicken-and-egg argument t o me. Which comes

first? You're saying that if financial results are good that means I can go
into a process of introducing OL. But there is an alternative premise that
says that OL is supposed t o help us get better results-financial and oth-
erwise. In fact, certain units are obtaining better results with OL such as
the Electrical Fuel Handling Division (EFHD) of Ford, which subsequently
became part o f Visteon. They were able to obtain improvements in qual-
ity, cost, timing, and profitability4
Bert: There are certainly situations where it seems that applying OL
methods and tools has led t o financial results, but it's not clear to me
that we're able to prove to the vast majority of management that these
results can be attributed to OL methods and tools. It's a question o f attri-
bution.
Iva: I agree that attribution is a challenge. It's a particular challenge
in the case o f OL because cause (the application o f OL tools and meth-
ods) and effect (financial results) will be separated in time and space.
That makes direct attribution difficult. But, there's a subjective aspect to
all objective measures: how results are being evaluated depends upon
who is measuring and for what purpose. Organizational politics and
other issues can affect how certain results are interpreted and attributed.
Measurement and attribution are probably the most difficult issues
that proponents o f OL face. They constitute a significant obstacle t o this
work, but we won't be able to continue pursuing OL as a way to create
future results if businesspeople don't take that risk.
Bert: That's exactly what I'm saying.
h a : But this has a lot more to do with how goals and measures are
set and who sets them than it does with OL perse. What measures really
tell us that a company is alive? Until we have that, OL will have a hard
time.
Bert: I think we are in agreement on that. If Wall Street doesn't think
well o f the company, or your division president doesn't think well o f your
division it's risky t o introduce OL. And so far that depends on how well
you're doing according to traditional measures.
h a : So as an OL leader one of your first jobs should be to determine
what the "vital signs" o f your organization are. In my view, the vital signs
are the aspirations or values that guide actions in the organization much
more than the financial results.
For example, in his book The living Company Arie de Geus talks about
learning as the primary competitive advantage. He discovered that com-
panies that have longevity-remarkable longevity as i t turns out because
some companies are 700 years old-have certain characteristics. They are
sensitive to environment in order to learn and adapt; cohesive, with a
strong sense of identity; tolerant of unconventional thinking and exper-
imentation; and conservative in financial policy in order to retain the
resources that allow for flexibility.5 Companies with those features are
 Chapter 11 / The Adaptable Map 241

the ones that live. The rest just come and go. If Wall Street would under-
stand those factors and start thinking about how results are produced in
a different way than they do today, things would change.
Bert: But that's not current reality and if we are going t o make OL
sustainable, we have to respect our current reality. I agree that OL will
help a firm in perpetuity, but I also believe that if you have a survival
issue on your hands, forget the perpetuity stuff. For me it's a question of
prioritization and sequence. I'm not excluding either; it's a threshold
issue and a question of timing.
Iva: But then how do you get t o survival?
Bert: You don't do it with OL because there are time delays. You do
it with the tried-and-true methods of command-and-control in terms o f
getting your house in order.
Iva: I think that's a critical paradox of all o f this work. Is it possible
that this is a pragmatic decision but one that immediately sets up an
internal conflict? Perhaps it is precisely because the potential of the peo-
ple has not been unleashed-because you have a command-and-control
organization-that you're in a dire financial situation.
Bert: That could be, but that's reality. In reality, how many options
do you have? I'll go further. If you are doing OL work and your perfor-
mance falls, the first thing that would be stopped is this type o f work.
Iva: But isn't that the tragedy o f it?
Bert: Oh, it may be very tragic if you're committed to this work.
Iva: It's a catch-22! You can't embark on the things that would help
you improve because you're not there already.
Bert: There's no point in trying t o save the life through remedial
surgery if you don't first stop the bleeding.
Iva: So when you say, "Get the results in order," you could be talking
about downsizing?
Bert: Whatever it takes.
Iva: So there is going t o be a cost to innocent people that you're
going to have to live with before you can say, "OK, now I can care about
people again."
Bert: If you're being hobbled in some way, you have t o a t least begin
standing on both feet before you can start a learning effort. If that
means that your budget is in crisis and you're going to have to cut peo-
ple to get within budget constraints, then that's what you do. Stop the
bleeding before you look a t the rest.
Iva: Rather than risk embarking on an OL journey with the conviction
that it will yield the results? If I have a difficult financial situation that
requires the engagement of people to resolve, I think a better process is
to give the people some tools to help them be more creative. That's much
better than standing on top saying, "You're in; you're out because you
didn't make your financials."
242 Part 4 / Mapping

Bert: I agree with that. It is a better strategy. But my question is, If

you're in financial trouble, can you afford to take that road? Can you
really afford to take that risk? Or are you first going t o have to do some-
thing precipitous to stop the leak?
h a : I am saying that the risk o f doing something precipitous is no
more or less than the risk o f attempting t o integrate the people and their
thinking into the process o f creating the results you all want.
Bert: I disagree. Remember the conversation we had with Dave
Marsing about how you can put only so much tension into the system?

Dave: I have loads o f compassion for my boss. I put my boss

through absolute agony! Because I get the results, I have a lot of
latitude, but there are limits. That is why the immune system
analogy is really important. Because you need to know what the
threshold o f tension is in the organization. How much can it tol-
erate before you begin to trigger automatic responses?
Bert: Right. So you know when t o back off.
Dave: It's not so much that you back off because then you're
not making any progress. You have to fine-tune how much ten-
sion you knowingly put into the system. If you want t o make a
change, the system needs a certain amount o f tension because
it stimulates growth and learning. You just need to be a good
judge o f how much tension the system can tolerate before it
a utoma tica I ly rejects you.
I keep up constant tension in multiple dimensions, but I
don't do it a t a pace that cramps people. And what's great is that
in different networks within the organization, people's tolerance
for my tension has grown over time. They get used t o it. Then the
energy level that they've been operating at begins to subside
because they've adapted to that level of tension. And then you
"up" it a notch.

Bert: I submit that embarking on an OL effort when you're bleeding

financially puts too much tension into the system.
h a : I acknowledge that I introduced too much tension into the sys-
tem a t Philips when I was doing OL work. That had less to do with OL
itself than it did with my lack o f understanding a t the time about how
to work with the systemic nature o f change. So I certainly agree that you
must be mindful o f the amount of tension you put into the system. You
have to introduce tension very artfully. But I submit that you also put
intolerable tension into the system when you make arbitrary decisions,
such as the decision to downsize in response t o financial problems.
 Chapter 11 / The Adaptable Map 243

Bert: But you have t o remember that t o the outside world, the deci-
sion t o use 01 as a remedy actually seems much more arbitrary and risky
than a decision t o downsize. With OL we're trying t o institute a change.
Instituting a change in an organization that's in financial turmoil is sim-
ilar t o trying t o apply consensus decision making when you're in a the-
atre that's on fire.
h a : So we resort t o so-called proven methods. As you say, there is as
yet no real compelling case that proves OL creates the path towards
reversing downsizing.
Bert: My point exactly. I agree that you can't reach your potential
unless you use OL and we do have some evidence that supports that. We
have pockets o f people who have demonstrated that they have been able
t o think out-of-the-box better and handle the vertical ramp-ups better
because they had OL. So I think there's demonstrable proof o f that. But
that doesn't constitute critical mass.
That's why you first have t o take care o f business-in terms o f known
methodologies such as downsizing or product redefinition. It's very dan-
gerous t o adopt a significant departure from normal values in the culture
t o fix a problem when in fact you're in a state o f financial uncertainty.
It's dangerous for you and it's dangerous t o the future life o f OL. It's like
in WWII: If you open up too many fronts and you're not consolidated on
any o f them, you're going t o lose. So you better consolidate one or two,
or you'll be shut down.
But then remember t o take o f f the tourniquet, because if you leave
it in place, you're going t o get gangrene. Similarly, if all you care about
are your financial results, you're not going t o have sustainability down
the road. To sustain your organization long term, you also need t o devel-
op the infrastructure for OL.
Iva: Do you recall how Dave Marsing helped us put this debate in
perspective?

Dave: You're both right. OL is both a dessert topping and a

floor wax. Let me tell you what I mean by that. It is absolutely
essential t o achieve the results that the Board o f Directors and
the stockholders expect and assume. It is, however, not sufficient
t o only do that. To ensure that you have a future, you have t o be
able t o anticipate opportunities and be agile enough t o capital-
ize on them when they're there. To do that you have t o do some
things better than just being the best in the world a t reacting.
In other words, you have t o be able t o learn.

Bert: People have t o evaluate their own situation and decide what
their risk factors are.
2 44 Part 4 / Mapping

Iva: As they're evaluating their situation, I think they need to ask

themselves a different set of questions than just the usual. Why not ask:
Why are we getting these results that we don't want?
What are the systemic causes o f these results?
Are we thinking about the future or just reacting to the present?
These questions may prove to be fruitful and maybe they could lead
people out of the usual mess we create with our "quick fixes''-but asking
these questions takes some courage.

Porta Is for Lea r ning

Bert: Assuming that you've been able to answer the questions above,
then you can move on to address some of the other kinds of timing issues.
You can look for obvious openings, or portals, where a new approach can be
most easily introd uced.
Iva: Probably the most ideal condition for an OL project is a Greenfield,
but even in Greenfield situations the culture is not necessarily completely
open. For example, even newly hired people will have preexisting assump-
tions. Leaders need to set the context and then train and orient people to
the learning environment.
Bert: A burning platform can be another great opportunity for learn-
ing. A burning platform is created when people don't know what t o do
and are searching for solutions.
Iva: So you have almost an existential crisis in that the old way
doesn't work anymore.
Bert: There is now a vacuum that something has to fill. That creates
an opening for a credible idea, a credible leader, or sometimes even a
prophet who comes forth and says, "Let me give you the word."
Iva: In my mind, we're back to the financial question again. Couldn't
a problem with financial results constitute a burning platform? In other
words, a financial crisis for which there is no obvious proposed solution
could be conducive to OL. Do you agree with that?
Bert: Yes I do, but only if certain conditions are met. The proposed
solution has to have credibility. Now, the leader can provide that credi-
bility i f people trust the leader and respect the leader. The other source
o f credibility is the proven track record of the method. People either trust
the method or they trust the leader.
Iva: So you're saying that a burning platform could provide a way t o
introduce OL even though it's unclear that OL has that proven track
record?
Bert: It depends on whether the OL leader is credible.
h a : Which might be tough t o find in an organization where the only
experience is having gone through one crisis after another.
 Chapter 11 / The Adaptable M a p 245

Bert: But remember what Bill O'Brien said about leaders needing t o
be forged out o f the suffering o f the organization?

Bill: The conclusion that I've come t o is that the people who
are going t o do the leading ought t o emerge out o f the suffer-
ing o f the organization. "Suffering" could be too strong a word,
but certainly leaders need t o have experienced firsthand the
frustrations o f dealing w i t h the politics, the bureaucracy, the
inconsistencies o f today's business organizations. And then, the
miracle is that rather than becoming cynical or defeated,
through some kind o f internal alchemy they've turned that frus-
tration and pain into a constructive frustration.
That's the transforming energy that's going t o help us make
profound change in our organizations. It's generative energy and
it's informed by both experience and compassion.

Iva: One final thought, if I may. As leaders we have t o do some deep

thinking about what kind o f thinking caused us t o get t o the burning
platform in the first place. Secondly, if you're a leader in an organization
that has a burning platform your credibility may be in jeopardy. If you
don't think that OL has credibility yet, then you might not be motivated t o
take a risk with it. That's if you want t o play i t safe. But there's another
side t o the coin. Surely we don't want to just keep replicating the same
thinking that created our problems. We may not have the luxury o f wait-
ing for proof. We may have t o take a calculated risk and in order t o create
a different future.

Can You Hear the "Natural Heartbeat" of the Organization?

Bert: This concept comes to us by way of Dave Marsing a t Intel. Dave
realized that he had t o take a "stealth" approach t o organizational learning
work.

Dave: Topmost in my mind-and this is really key t o both my

philosophy and strategy-is that I want t o do this work in such
a way that the transformational aspect is not obvious. So I map
out the key change points, problems, and issues that I anticipate
coming down the pathway. Then I think about how each one o f
those can nudge OL another step further.
I very subtly use this method as an ongoing practice. The
idea is t o expose people gradually so that eventually it's auto-
matic and happens so easily and naturally that they don't even
know they're "lea rn ing ."
246 Part 4 / Mapping

Bert: Dave discovered that there was a natural rhythm or "heartbeat"

in his organization. There were some patterns to the way things worked.
Once you discern the pattern you can see that there are some obvious
and natural opportunities for learning.
h a : We should share the story Dave told us about Boeing. He pro-
vides us with a good example.

Dave: We had a joint effort with Boeing in which we tried

to help the people at Boeing design ways t o leverage learning
given the pace o f their business. This was within the context of
both the introduction o f new models and the introduction of
significant redesigns and subsystems into planes.
The folks at Boeing were getting frustrated because they
were pushing against a very set cadence in that environment. So
we tried t o get them to start thinking about what I called the
natural heartbeat of the organization through observing the
cycles involved in production. There are transitional periods in
the production cycle and if you're prepared to launch learning
initiatives at those times, you'll be working with the organiza-
tion's natural heartbeat rather than against it. And most com-
panies have those kinds of natural rhythms.

Bert: Many o f our TQM projects failed because we didn't choose

projects that were meaningful t o the organization. Hopefully, we all
learned that lesson. Now here's an opportunity to learn a lesson about
how to determine the appropriate timing and pacing for a learning effort.
All organizations operate according to their own rhythm. The skill for us
as leaders is to develop the capacity t o observe those rhythms, t o hear
the "natural heartbeat" of the organization, and then capitalize on it.
Iva: So we're saying that you need to look for the portals, the natural
windows o f opportunity when the organization is ripe for change. If you
understand the rhythm o f the organization you'll have a better sense o f
when those portals are likely t o show up. You'll know when learning
efforts can be inserted organically into the pulse of the organization such
that they will enhance the flow more than disrupt it.
Bert: Right, thus minimizing the possibility o f initial rejection. If
you're looking for a portal, the following questions might help:
If you are involved in product development phases, do the periodic
changeovers to a new product represent a portal?
Are there opportunities during the budget process? For example,
are there quarterly/periodic reviews to readjust the budget to see
how it compares with the forecast?
 Chapter 11 / The Adaptable Map 247

Does your performance review process include agreements with

employees about their personal development? Is the company or
division reviewing its training curriculum?
When you do employee surveys, are there meetings to determine
what you're going t o do about the results?
Are there TQM or other local initiative forums where new ideas are
fostered and tried? Many companies have Quality audits, which
provide an opportunity t o question assumptions. What processes
do you use to engage employees in openly sharing their ideas?
Would OL tools and methods be helpful in that process?

Is t h e Leader Ready?
Bert: Thinking about leadership readiness reminds me of something I
heard John Naisbitt talk about. He talked about a "Want Ad" looking for
people to volunteer for a job. The ad said that the job would involve travel,
but it was going to be cold and miserable. When you return, probably
nobody would recognize what you had done. It was even possible that you
may never come back alive. The ad was for a trip to climb Mt. Everest.
Despite that Want Ad description, about 360 people volunteered to take the
trip.
At this stage, an OL effort is like that. First o f all, leaders have t o
think that it's worth doing on its own merit. So you have to think about
what's driving you. If it's ego, ego falls away quickly as soon as resistance
comes. Ego assumes power, but you're not going to have power when
you're trying to bring in new ideas and you find that some people are
fighting you. You're going t o be standing alone a lot.
Iva: I see the issue o f power a little differently. It's about how you
use power with those ideas. If you use your power from the old paradigm,
it will bite you back. The more you push, the more resistance you'll
encounter and yes, you will become a lonely leader. One o f the reasons
you can be lonely is because people are afraid o f the way that you might
use your power. So you have t o let go o f power and ego a t the very
beginning, but there's a built-in paradox. You can't do this work without
devolving power, and you can't learn how to devolve power without
doing this work. So while you're trying t o make that transition there are
going to be difficult moments for both yourself and the organization
until you reframe and are truly seen as a leader that is not using their
power in the old ways. This is where the need for collaboration comes in,
because you will need other people to make this transition successfully.
As a leader, you have t o be humble and accept that you do not have all
the answers. You have to acknowledge that you do not know and be will-
ing to be vulnerable, but you also have t o be strong and very committed.
24% Part 4 / Mapping

Bert: If you want to do this kind of work-if you want to transform

an organization-I'd go so far as t o say it's going to be a rough road. You
have to like solving puzzles and problems, dealing with people, and valu-
ing differences. You must understand that that which is worthwhile may
take some time and a great deal of effort, so you have to like solving puz-
zles and problems, dealing with people, and valuing differences. You have
to understand that you'll probably feel real low and also very much alone
sometimes. It's almost-I hate to go this far-it's almost heroic. On the
other hand, you have to have a very practical mind. If you get too heroic,
you become ineffective. And if you get t o a place where you're becom-
ing too crusading in your attitude-and I did become almost evangelis-
tic-you tear yourself apart. As somebody very eloquently said, "The soft
stuff is the hard stuff." Trying to create a learning organization is the
hard stuff. So you have t o be certain that you are willing t o take on the
task, including the risks and possible reversals that may be experienced
as you lead a learning effort. In other words, you have t o be sure that the
timing is right not only for the organization, but also for you.
Iva: So the question is: Is the leader ready? Although this seems like
a simple question, we think it is extremely important. Senge has written
that organ iza tiona I transformation beg i ns with persona I transformation.
Argyris's work underlines that idea, emphasizing the interdependent
relationship of personal and organizational change. Neither one of us
knew enough to do a more formal self-assessment when we began.
However, we're now both certain that it's a good idea.
Bert: I did not do any kind of in-depth self-assessment. However, I
did my own sort of personal SWOT analysis. I said to myself: Make sure
this is not an ego trip. If you have a lot of ego be prepared to be hum-
bled. If you feel that you're a t all vulnerable in your job, don't do this! Go
back to basics contingent to your bottom line.
Iva: I did not do this kind o f reflecting until much later, and then I
wanted t o go much deeper. I wanted to really know myself, to learn how
to be introspective, and to understand more how I impact the world
instead of just focusing on how things impact me.
Bert: Phil Carroll gave us another perspective when he described the
kind of personal reflection that he engaged in just after he learned that
he would become the next CEO o f Shell Oil.

Phil: I didn't go through an experience like St. Paul on the

road t o Damascus, but I did a lot of reflecting and thinking. I
spelled out in my own mind what changes I thought were nec-
essary and desirable.
For example, as I reflected back on my own managerial
experience, I saw that we had a pretty effective model o f man-
agement at Shell, but it was based on a certain understanding o f
the employee contract. The contract went something like, "I am
 Chapter 11 / The Adaptable Map 2 49

the company; I am the management. You get security, protec-

tion, and largesse from me, and what I demand is loyalty and
willingness to follow my orders." That was the model for the
most part. It was a royalist model as opposed to a democratic
model. As you get into this new world, however, that model just
isn't going to cut it, so we all have t o change.

Bert: As I listened to Phil I had an insight into my own motivations.

The employee-firm implied social contract that Phil talks about seems
less prevalent today. Companies used to offer security in exchange for
loyalty, but that contract has given way as people now want jobs that
offer creativity, excitement, and opportunities for personal growth and
rewards on multiple levels. Underlying those expectations I see a need for
congruence between people's values and the firm's mission.
This shift in the contract has affected me personally. When I began
my OL work, my driving personal concern was not to lose my job. I can
see now how that affected the decisions I made. Having gone through
that experience and thinking about it further, my new requirement is to
find a meaningful way to contribute and make a difference.
Iva: So I think we're agreeing that some degree o f self-assessment is
absolutely necessary, but the depth o f the self-assessment you're able to
do will depend upon what you're ready for and how much support you
have.

Areas of Inquiry for the Leader

As Senge et al. have so clearly articulated, change is a kind of
dance. Leading change is even more demanding, since leaders are,
in many ways, summoning forth the music. The leader is not scor-
ing the music, as a command-and-control leader would do. In this
case, the score is being written by many. Rather, the leadership is
enabling the notes to come together in harmonious progression.
Leading change requires the deft orchestration of balancing and
reinforcing forces. Leadership must be more collaborative; in
other words, more adaptable and fluid. That fluidity shows up in
a number of ways. Specifically, Senge has also identified three
types of leaders who are important for a learning effort: executive,
line leader, and networker.6

Iva: I would like to expand this view a bit. Ideally, the OL leader
needs to understand all three and also be capable o f embodying all three.
This is in my view the most difficult task for any leader who has grown
up in a command-and-control environment, like Bert and I did. I have a
lot of hope that leaders that are coming after us will be better prepared
250 Part 4 / Mapping

for it, and I hope we will contribute to it. Speaking for myself, I can say
that learning how to embody that which I want t o create is the most
important and learningful part of the journey I am on.

Through our interviews we have learned that OL leaders seem

to manifest these qualities:
A balance of pragmatic and visionary perspectives
A commitment to values
The ability to design effective strategies and tactics
A commitment to greater collaboration and the skillful
devolution of power that will make collaborative leadership
possible
A commitment to steward learning
A commitment to be learners themselves
A commitment to defining their own unique pathways
As we reflected on these qualities, they seemed to lend them-
selves to questions that we might ask ourselves before embarking
on a learning journey. The questions seemed to fall into six areas
as shown in Figure 11.1.

Figure 1 1 . 1
Self-Assessment Areas

The first three areas-self-knowledge, strength of commitment,

and the ability to live in paradox-all address the inner territory,
the starting place for the inner journey. Openness to learning and
 Chapter 11 I The Adaptable Map 251

situational acuity both address the ability to sense emergent

forces, to reflect, and to learn through our reflections on action
and practice. The area of practical knowledge and ability should
help us to realistically assess to what degree we have the skills and
resources to begin the journey.
In the pages that follow we offer our reflections on each of
these six areas and offer questions that you might wish to ask
yourself as you invite your own learning journey. From these snip-
pets of our reflective conversations you'll observe that we don't
always see things in the same way or even agree on the depth of
self-assessment that is required of OL leaders. We hope these dif-
ferences stimulate and enrich your inquiry. Again, there is no sin-
gle path; yet, at a deep level, there is fundamental agreement.

SeIf- Kno w le dg e
Iva: One's ability to design strategy and follow one's own path seems
to flow directly from self-knowledge. Dave Marsing seems to be a terrific
example.

Dave: M y work with Human Dynamics helped me t o under-

stand the way that I deal with things and the way I process
information. I know my strengths and weaknesses better and I'm
less likely t o attempt things that are not in tune with my partic-
ular dynamic. For example, I realized that things come together
for me visually, in a very integrated, organic kind o f way. If I try
to force my thinking into a linear, mechanical structure, I create
more problems than when I let my thinking follow its natural
path.

Bert: I think what's important is not so much "knowing yourself" in

the broad sense as it is to understand the leverage points of your
strengths and weaknesses, knowing how others view you, and having a
clear sense of your ability t o shepherd this work in your organization.
Here's an example. Say you're a leader known for being very pragmatic
and results-oriented. If you embrace OL then you'll bring your credibility
to this work, which would be an interesting and very, very desirable
event. However, if you have a reputation o f pursuing every flavor-of-the-
month fad, you're not going to be able t o bring credibility t o the table
and that will be a significant disadvantage. What do you do, then, t o
build credibility? Here's where you might do a kind o f personal SWOT
analysis.
Iva: You're saying that self-knowledge is about knowing yourself in
the context o f the journey: Are you the appropriate person to lead this?
252 Part 4 / Mapping

Understanding your strengths and weaknesses is necessary but I would

still suggest that's not sufficient.

Questions t o Help Your Self-knowledge Assessment

Do you resonate with the qualities we have found in other

OL leaders?
Do you have a clear sense of why you want to embark on
this journey? Where has that clarity come from?
Ask yourself whether you have the strength of character to
define your own pathway. Is your ego strong enough-but
not too strong?
Locate your level on the Rooke Torbert grid. Are you a "strate-
gist?'' What are your strengths and weaknesses vis-a-vis
a learning effort? What skills might you need to develop?
Do you have the ability to communicate and network suc-
cessfully within the existing hierarchy and across functions?

Strength o f Commitment
Bert: Phil Carroll gave the best description of how I feel about com-
mitment.

Phil: If you're going to go into this as the leader, you have

to have an intensity o f belief in what you're doing that is very
high. You have t o honestly say t o yourself that if I cannot do
this-if the organization rejects my efforts to make change-
then I have failed. If leadership above me will not support it, if
my boss or whatever key support I need won't let me do this,
then I'm better off out o f here.
If you're not willing to say that and really mean it, then you
probably should not take this on. I say that because this is not a
comfortable, easy thing t o do. It requires enormous amounts of
energy to keep it going, both psychic as well as physical. If you're
not deeply committed, you shouldn't begin. That's why I feel so
strongly about emotion playing a part. There is no way you can
reuson t o sufficient commitment to logically undertake this. You
have to have very strong feelings.
We all have times of doubt and concern-meetings where
you think, "that was terrible"; times when you think people are
not getting it; or times when business starts going bad and you
have particular problems. You worry about it and question
 Chapter 11 / The Adaptable Map 2 53

whether or not you are right. But if you entertain those doubts
for very long, you'll lose your ability to go on.

h a : For Bert and myself it was important enough to put ourselves in

jeopardy. Upon reflection I realized that my commitment was coming not
just from a concern for profits, but from a deeper place. If you are able
t o have clarity regarding the source of your motivation, this will help you
channel your commitment and effort. You'll also be freer to make
informed choices.
Bert: The question is, where's your bottom line? What constitutes for
you an inability t o continue? I accepted certain boundaries because I had
a fear o f losing my job.

Questions t o Help You Assess the Strength o f Your Commitment

What is your experience with making commitments?

Are you prepared to conduct (several) experiments, reflect-
ing and challenging your assumptions?
Can you make a commitment without knowing what the
outcome will be?
How important is this work to you? Are you willing to put
your job on the line?

Living with Paradox

Iva: Sometimes it seems as if people in the business world constantly
encounter paradox. We want contradictory things and there does not seem
to be a solution. Whether we go in one direction or another, the outcome
does not seem satisfactory.
Bert: I can see where management in particular can be torn by pri-
orities that seem to contradict each other. We care about people but we
have to lay off people to reduce cost. Is that what you mean?
Iva: I think both of us have experienced being in paradox without
realizing it. I believe we're caught in those contradictions because we're
living in between t w o systems. On the one hand we have the hierarchi-
cal, command-and-control way of being that we were brought up in; on
the other hand we have this new system that's trying to be born, a new
system that is emergent, connected, and based on relationships.
Bert: I think a lot of us have dealt with that tension through com-
partmentalization.
Iva: The problem with compartmentalization is that you deny the ten-
sion rather than hold it. If you compartmentalize, the long-term conse-
quence is that you tend to become more disintegrated as a person and you
don't find real solutions-you reach for a "quick fix" instead because you
254 Part 4 / Mapping

want to make the tension go away. Ideally, we resolve paradox by ques-

tioning assumptions and reframing the situation, but that's not instanta-
neous. The only way to accomplish that is to hold the tension. Holding ten-
sion puts us in a place that feels very unstable-yet it isn't. I think we're
finding that if we can learn to hold that tension we can discover a way to
reframe and then solutions begin to show up unexpectedly.

Questions t o Help Assess Your Ability t o Live in Paradox

Can you both hold and live with creative tension?

Do you have the ability to live with (and within) two sys-
tems, helping to build the bridge between them?

Situational Acuity

Bert: I think that the ability to "read" a situation and to respond appro-
priately is a critical skill. I'm calling it "situational acuity" and I believe it's
an art. Rich Teerlink gave us a good example when he wouldn't invest his
two managers with command-and-control authority when he sent them to
resolve the problems in the plant.
ha: Rich knew just how to respond t o the situation to get the most
effective-and learningful-outcome. He used his command authority t o
force the two managers to learn how t o work together. He wouldn't let
them divide up the work, which would have meant they'd come from the
old reductionist paradigm. And he wouldn't let them resort t o command-
and-control t o solve problems.
Bert: That's very artful.
Iva: It's particularly artful because he wasn't just resorting t o com-
mand, but doing so in order to promote learning.

Questions t o Help Assess Your Situational Acuity

What is your model of leadership?

Is your leadership style flexible? How do you know?
How might you develop your situational acuity?

Openness to Learning
Iva: How do you assess your openness to learning? You have to accept
that you don't know everything.
Bert: And that answers can come from anywhere in the organization.
Iva: And you have to be prepared to give up things that you really
believed were true. I believe that this also involves an openness to learn-
 Chapter 11 / The Adaptable M a p 255

ing from so-called failure, unlearning and changing your views, and
developing an appreciation for diversity.

Questions t o Help Assess Your Openness t o Learning

Are you prepared to learn from your mistakes, examining

your assumptions?
Can you let go and move on or do you tend to dwell on the
past?
Can you show vulnerability, admit to others that you dont
have all the answers?
Do you value and seek out diverse viewpoints? Do you think
that good ideas can come from virtually anywhere?
Are you interested in nurturing the potential of others?
Have you reached out for appropriate help in making these
appraisals of yourself?

Practical Knowledge and Ability

Bert: There are a number of different aspects to the practical knowl-
edge you need. For example, you need the ability to assess your organiza-
tion whether you choose to perform a SWOT analysis or a cultural assess-
ment.
Iva: Its important that this isnt a solitary assessment-but as a
leader you do have t o see it most clearly and make sure that that reflec-
tive mirror is being held up to the organization. I would also offer that
you need a very good understanding o f the systemic nature of change.

Questions t o Help You Assess Your Practical Knowledge and Ability

Assess your understanding of the systemic nature of change as
described, for instance, in The Dance of Change by Senge et al. Will
you be able to identify strategies for weakening the balancing
processes? Also, assess your practical ability to lead change: your
knowledge of the systemic nature of change as well as your polit-
ical capital.
How well do you understand the systemic nature of change?
Will you be able to identify strategies for weakening the bal-
ancing processes?
Can you recognize-and resist-your organizations defen-
sive routines?
Do you have the practical ability to lead change? What is the
status of your resources, the strength of your network, and
256 Part 4 / Mapping

the courage of your allies? Do you have enough influence

and credibility to execute?What is the measure of credibility
in your organization? Do you have both the support and the
political capital you need?
What are your strengths and weaknesses vis-a-vis leading a
learning effort? Based on this overall assessment, how would
you describe your learning edge?

Designing the Adaptable Map

Once you have invited a journey, youll want to design your strat-
egy for bringing learning to life within your organization. The
caveat is that we cannot approach this task in the same way that
we have approached other strategy efforts. We are turning to a dif-
ferent kind of thinking about strategy. We used to take a very
reductionist, analytical, linear, and structured approach to strategy.
Wed design strategy starting with knowing what we want. Wed
develop the arguments to support what we want. Then wed go
through a linear process of policy deployment, delineating the
steps in between where we were currently and where we wanted to
be, dividing the tasks and measuring our progress along the way.
The emphasis was on analysis (not synthesis), central planning, a
formal strategy document, and formal presentations. The danger
is well proceed to do organizational learning in that same way,
but this kind of map cannot be designed that way.
We are coming to a new understanding of strategy, seeing it as
an organic, emergent process. Stacey defines emergence as a
process by means of which the business system as a whole can cre-
ate order out of chaos. When he says that strategy is an emergent
process he means that strategy does not emanate from a preor-
dained central vision. Rather, strategy arises out of what managers
do-and, consequently, what they learn as they do it. Strategy is
dynamic and it emerges from the ongoing, spontaneous, and
self-organizing processes of learning and political interaction.
Therefore, the work of leaders is not to define strategy in the rari-
fied air of a meeting room, but to create the context in which it
can emerge by entering into the mess of the organization. They
create a context that enables strategy to emerge by continuously
developing agendas of issues, aspirations, challenges, and individ-
ual intentions.
Since OL journeys involve ventures into new territory, we
believe that they are best planned with this sense of strategy in
mind. Learning journeys are best traveled using adaptable maps:
maps that sketch out the journey beforehand but which we can
 Chapter 11 / The Adaptable Map 257

also update and change frequently as new things are learned

about the territory and how best to navigate the terrain.

Phase 2: Mapping a Learning Journey

We will use this understanding of strategy as a backdrop to our
suggestions. At this point you have thought about vision and val-
ues, perhaps you have done some cultural and SWOT analyses and
self-assessment. Whats next?
Taking Dave Marsings advice, we suggest that you map out the
key change points, problems, and issues that you anticipate com-
ing down the pathway, thinking about how each one of those can
nudge OL another step further. As you begin to map the journey,
consider the best strategic approach for you to take given what the
people in the organization value, the possible vision that seems to
call to your organization, and your assessment of the organiza-
tions culture and learning needs. Think about what assumptions
or theory of change underlie your initial approach and how you
will test those assumptions publicly. (The process of surfacing
assumptions creates opportunities for double-loop learning.)
Think deeply about whether your organization needs to begin
with single-loop learning or if it is ready to move into a deeper
form of OL. If the latter, you need to think about how that dialec-
tical process can be supported. Consider how you might begin
building the capacity for learning within yourself, your team, and
your organization. Reflect on how youll design your map such
that it is adaptable, allowing you to learn your way into the strat-
egy as you go.

h a : Id like t o offer my thoughts on strategy. We have learned in our

journey that awareness is only a spark; t o light the fire more is needed.
The selection o f the methods and the consultants (capacity builders) t h a t
can provide the initial support is an important step. There are various
consultants who can bring the ideas o f OL t o life through their specific
tools and methods. Most o f these respected consultants deal w i t h all the
relevant disciplines, though most o f them have their own specific entry
into the learning process. For example, there are those who focus on
Systems Thinking, those who enter into this field through action science,
those who focus initially on human behavior, those who use Dialogue as
the entry point, etc. What criteria will you use t o decide how you are
going t o start?
Bert: I think the most important starting place is t o look for a way
t o align the corporate goals and values w i t h the goals and values o f the
people in the organization. Then build a bridge between those goals and
values and success in the marketplace.
258 Part 4 / Mapping

We believe that your initial map should also include a consid-

eration of the following:
Links to results;
Links across system boundaries;
Effective use of feedback;
Assessment;
Sustainability.

Linking to Results
Bert: Can you translate your learning pilot into a financial outcome
that is good for the firm? You may not be able to directly translate the ben-
efit of learning into dollars, but you have t o a t least have a conceptual link
to financial performance. That's what you're in this for. Don't misunder-
stand.
Iva: It's certainly important t o make the link between learning and
business results, but it's an open question as t o whether those results
must be strictly financial. Of course, learning should translate into finan-
cial results in the long term, but thinking this way in the short term can
also get us into trouble. We can talk ourselves out o f doing some foun-
dational work upon which our long-term success depends because we
can't immediately attach a dollar benefit t o it. I also recognize that you
can't ask a whole organization t o take a leap o f faith. Your reasoning has
t o be thought through and it has t o be open t o challenge.
Bert: For example, you could make a very clear argument such as the
following: If I build the capability o f people in this way, they will be
uniquely qualified. If they are uniquely qualified, their efforts will gener-
ate product ideas that will shape the marketplace. If we shape the mar-
ketplace, we will be able t o charge high margin prices because we have
the first mover advantage in the marketplace. Then we'll have extreme
profitability. You can take a scenario like that around t o people and see
if they want get behind it or challenge it.
Iva: I agree that you need t o link learning t o specific results, but let's
not forget also that when people start t o realize results on the personal
level that creates energy that sustains learning.

Linking Learning t o Results

Have you defined the results you expect from your learning
effort? What kinds of personal results can people expect to
experience? Have you discovered what results are meaning-
ful to the organization?
 Chapter 11 / The Adaptable Map 259

What measures will allow you to assess the impact of learn-

ing on results?
When do you expect to see results? Does the timing of antic-
ipated results jibe with the rhythm of the organization? If
not, will the organization be able to tolerate the delay? What
you can do to help the organization manage that tension?

Define the Boundaries and Linkages o f the System

From the beginning, think of the group you will be working with
as a system, a system with boundaries and linkages to other sys-
tems. It is also a subsystem within a larger system. By thinking in
these terms you can begin to anticipate how learning and change
within your system may affect other systems. Since the systems are
inherently interconnected, your unit cant really go about its learn-
ing process in isolation. The assumption that you can do so has
contributed to the perception that OL pilot groups are cultlike.
New things often need nurturing incubators in the beginning, but
they cannot be isolated from the rest of the world for too long or
they can become cultural islands within the larger context.
The learning initiative described by George Roth and Art
Kleiner in their book Car Launch provides a good example of what
can happen when we dont realize that we need to manage these
linkages. Organizations need to have a common understanding of
what numbers mean in order to effectively coordinate action. In
that case, however, the learning team was using certain key indi-
cators in a new way. This led to a rise in the reporting of errors-
actually a sign of increased learning. As you might imagine, these
numbers were interpreted in an entirely different way by manage-
ment in other functional areas and by the senior management of
the larger system. This led to confusion and conflict.8
Understanding the boundaries of the learning system, manag-
ing the interconnections, and engaging the larger system all
require skills that may be new to us. They also require significant
communication skills. Research by Argyris and Schon has indicated
communication difficulties associated with hierarchies and cross-
divisional relationships comprise one of the major threats to orga-
nizational learning. Therefore this kind of communication repre-
sents a learning edge for most managers. Rather than following
our Model I tendency of trying to convince others that we are right
we must practice holding tension and learn how to engage others
as we go.
260 Part 4 / Mapping

Questions t o Help You Consider the Boundaries o f Your System

Have you defined the boundaries of the system you are

working with? Are you working at the team level? The unit
level? The organizational level?
How does the system you're concerned with interconnect
with other systems? If learning changes how your team or
department works, will there be an impact on other subsys-
tems?
.When and how will you engage the larger system?
(Remember that waiting until you have results to show is
most likely a poor strategy.)

Using Feedback Effectively

In systems thinking terms, feedback loops are always present.
Feedback informs how the system responds to the larger environ-
ment. Scientists have observed that because of their ability to use
feedback, systems can exist in a state of bounded instability; they
can constantly change without disintegrating or descending into
turmoil. Human beings may realize the same benefits from feed-
back; however, they may need to develop their capacity to see,
interpret, and use feedback. In human terms this means that we
may need to actively seek out sources of feedback and link into
them.

Bert: Feedback can help with issues of pacing and timing that can
tend to trip up a learning effort. If you get good feedback you'll be bet-
ter able to remap in midstream.
Iva: We need feedback not only to help with our strategy, but also to
guide our personal transformation. We need to reach out for help in the
form of coaches, trainers, and/or truthful, courageous supporters who
will tell us whether we are "walking our talk" and living in accordance
with our espoused values. We cannot do this work as the lonely, heroic
leader because we can never really see ourselves objectively. We need to
question and test our assumptions and practice new ways o f being in
collaboration with others, in communities o f practice.
Bert: So if we're really committed to getting good feedback we may
have to create new structural elements or make some personnel changes.
Iva: Right, you may need to spend valuable time developing a sup-
portive network before you can begin. Furthermore, if you want to be
able t o use the feedback you get, you may need help with building your
own reflective capacity or that o f the organization. Particularly, if we're
trying to create a Model Il-based organizational learning system, we
 Chapter 11 / The Adaptable Map 261

must create the opportunity for a dialectical learning process t o occur.

You may seek out a qualified facilitator, coach, or a reflective analyst.J

Questions t o Help You Use Feedback Effectively

Have you found and developed a supportive network? Have

you found people you trust who will give you honest feed-
back? To what degree are you open to coaching?
Have you created the necessary structural elements that
enable feedback for your organization, such as a reflective
analysis or an after-action review? Will feedback be commu-
nicated-both to the team doing the work and to those as
yet uninvolved?
Is there coaching support provided for others in your orga-
nization?

Assessment
Assessment is one of the toughest assignments. If possible, identify
multiple measures in order to have the fullest possible picture. In
the very beginning, identify some interim measures or indicators
that you can use to assess whether your learning effort is on
track-especially if you anticipate delays. Define both qualitative
and quantitative measures. Find out who has to agree on the mea-
sures and get agreement. Prepare the ground so that a perceived
failureto meet some early yardstick can become an opportunity
for learning rather than a reason to pull the plug. One of the keys
will be to find the ability to back off from time urgency that so
characterizes command-and-control type leaders and many orga-
nizations. Learning both creates and requires delays.

Bert: One of the ways we can apply what we learned from TQM is
to get agreement with the relevant parties on the terms o f assessment
ahead of time. Get agreement that if things appear to get worse in the
beginning they wont just pull the plug. In fact, we need t o give our-
selves the space t o make that agreement and find the time for the
results t o show up.
But its not only the issue of time that needs t o be understood. One
also needs to have a clear understanding o f how results in an OL context
will differ from previously published norms. Im thinking of the Cur
launch example. Just as the history o f TQM shows us, a new approach
generates very different kinds of results, which may not match expec-
tations. Unless the ground is prepared, these results will most likely be
m isinterpreted.
262 Part 4 / Mapping

Iva: The key is to initiate generative conversations up front so that

the proper assessments are in place thereby minimizing the potential for
knee-jerk reactions t o those different results that learning projects tend
to produce. But that's also a bit of a catch-22 because in order to be suc-
cessful in those conversations one has to be skilled in the practice of
having those conversations-and most of us are not. Furthermore, you
may need to unveil your concerns, reveal what you don't know. In other
words, you may need to practice OL in an environment that may not be
quite ready for that approach.
Bert: The larger question is: How do you launch OL if the organiza-
tion doesn't believe in it yet? You do what you believe will work in the
situation. Certain environmental conditions may allow you to proceed
without as much agreement-although perhaps with increased risk. This
may involve some political savvy on the leader's part because this is a
political process. For example, you have some political capital that you
can spend or if you have some established credibility and strong allies
you can work the political process. For example, i f you've got a portal
because you're in charge of a Greenfield you have latitude. If you've got
a portal and you're certain that you can deliver on the expected results
without a time delay by doing OL work, then you can take Dave Marsing's
"stealth" approach.
Iva: So we need to be politically savvy even as we practice the art of
generative conversation.
Bert: Right. Again, we've got t o take a "two systems" approach.
Iva: Would it be appropriate to say that the most difficult thing to
project and assess is the delay? How is the delay created? What is the
structure o f the delay? We can retrospectively define what the delay was
and how i t influenced the outcome-system diagrams do that very well.
But can we forecast it?
Bert: The issue o f delay needs to be understood, and it's very com-
plex. If initiatives don't yield results within certain timeframes and
expectations they are pulled. This potentially results in a self-fulfilling
prophecy. Detractors o f OL say, "You see, it didn't work." Then there is the
potential for the OL people to use excuses, "Well, you didn't give me
enough time and that's why it didn't happen." This is a complex area,
fraught with potential problems, so several things need to be considered.
Consider the challenge of attribution. When we first embarked on
Quality efforts the results actually got worse in the beginning. We were
unprepared for that. Later, we learned that was a normal part o f the jour-
ney. The reason things seemed t o get worse was that people started t o
focus their attention on it. OL seems to be following the same pattern as
the Cur launch example demonstrated."
Iva: There's also our personal sense of time urgency, which affects
how we're able to deal with delays.
 Chapter 11 / The Adaptable M a p 263

Bert: Since many of us leaders are "Type A" personalities, we can all
learn from what Phil said.

Phil Carroll: We're all impatient. We all would like to see

things accomplished faster. But I believe that there is an inher-
ent pace to things. There's a pace that is unique to the company
and the industry. The pace o f our business is going to be geared
differently than the pace of things in a Silicon Valley startup or
in Ford Motor Company.
A sense o f urgency, a desire to move quickly is a strong, pos-
itive trait, but you can't have the expectation that learning is
going to happen miraculously overnight. You have to build capa-
bility, you have to erect a learning infrastructure within an orga-
nization through processes that reinforce it. All of that takes
time.

Questions t o Help You Plan for Assessing Your Learning Journey

Who needs to agree on the terms of assessment? Are you col-

laborating with them?
How should your learning effort be assessed? Should there
be qualitative as well as quantitative measures? Can you
define interim indicators of progress?
In what timeframe can you expect to see results? What if
there is a delay?
How might you capture what you are learning along the
way-without sanitizing out the missteps and "failures"?
How will you diffuse what you are learning?

Sustainability
Even before a learning effort is brought to life, think about what
energies, what currency will keep it going. Perhaps thinking about
this topic will lead you to do some things differently even at the
very beginning.

Bert: People tend to associate any kind of movement with the per-
son who is most prominent. It's a natural tendency, but i t gets in the way
o f change, as Phil Carroll pointed out.

Phil: When it became obvious that my time was coming to

an end and I was going to leave, I got a lot of questions at var-
ious meetings. People asked, "What's going to happen t o all this?
2 64 Part 4 / Mapping

Why should I commit t o this thing if you're going t o be gone in

another 12 to 14 months and this will all go away?" I said, "If I
leave and the transformation process goes away, then you were
not transformed. You never were really with it. You were just
sort o f an interested observer on the outside."

Iva: How does the leader create conditions for transitional change
without creating a legacy that other people will shy away from? How do
you design yourself out so the change doesn't depend on you?
Bert: After you've done all the right things, the important question
to ask yourself becomes, How much have I involved other people in tak-
ing the leadership position? Have I let other people stand up in front of
groups? It's important t o wean yourself out of the process, just like suc-
cession planning.
Iva: You also have to know when to do that, because if you do it too
soon, they might think you don't care. They think, let's wait this out.
Bert: You start by building the capacity, then you feather it down,
and then you almost work yourself out of a job. That's why it's like suc-
cession planning. If the movement is more important than you are, then
you drive for improvement in the movement, but then you don't leave the
movement in the lurch. You make sure that succession planning is part
o f what you do.
Iva: As a leader you also have t o come t o terms with how that's
going to feel. Leaders have pretty big egos-but t o plan for sustainability
you're going to have t o let go. That's not always comfortable, as Rich
Teerlink told us.

Rich: I would say that I was too wrapped up in myself and

too worried about my value to society. You ask: Was it all worth
it? How do you define "worth?" I'm a very wealthy man. But
wealth is not the scorecard. It's more about, How do you feel? Do
I feel that I made a difference? It's not about everyone else rec-
ognizing the difference. It's that I recognize it. But when you're
leaving the organization the fear is that no one will recognize it.
You've got to step back and say wait a minute. We tried this
and we tried that. Some things worked; some didn't. There was
a lot of frustration. But if I look a t where the company is today
and what's going on inside the company, I know I was part of
that. And if that lives on, what more can I ask for? Do I have t o
have my name associated with it? That's ego, and that's wrong.
You know, we started OL and I had a part in it, but it was a whole
bunch of people and I was one of many. There were a lot of good
things that happened that I wasn't part of.
 Chapter 11 / The Adaptable Map 265

And OL did make a difference. You see, that's the conclusion

that I evolved to. I know it made a difference and the hell with
everything else. And I'm going to tell people that they can make
a difference in their companies.

Questions t o Help You Design i n Sustainability

Will you "leave it better than you found it"? Will the effects
be significant and long-lasting?
Is your learning effort "personality dependent," or have you
created conditions such that the learning will continue if
and when you leave?

Phase 3: Beginning the Journey

As you begin the journey, you will encounter a major challenge:
How will you engage the organization? The way in which you go
about involving the organization in a learning effort is very impor-
tant because the way in which you engage people tells them how
serious you are about learning. It also tells the organization how
serious the leadership is about collaboration and the devolution
of power. If people see that they are being asked to be contribu-
tors, they will be more likely to engage. If you "roll out" a learn-
ing effort you deliver a very different communication than if you
engage people in a dialogue about where you all think the orga-
nization should go and why. A roll-out can turn people off
immediately, just as a vision statement that comes down from
the hierarchy generates little interest. As Stacey writes "the role of
top management is not to invent and preach simple, clear aspira-
tions but rather to create a context favorable to complex learning
from which challenges may emerge."12
A dialogue on the state of the organization can have mutual
benefits. Visioning may begin as a solitary practice, but clarity
about the vision and values comes with communication. Vision
needs to be shared. If a dialogue can be open and honest, it can
help clarify the vision and the values as well as the perception of
current reality. Of course, the problem is that the organization
may be predisposed against such honesty. It may be operating
according to Model I values-even while espousing Model I1 val-
ues. These situations are common. The question is: Are these bar-
riers anticipated, planned for, and worked through as artifacts of
the transformation process?
266 Part 4 / Mapping

The engagement process itself may be a learning journey.

Leaders may have to work hard at developing new skills: particu-
larly, the ability to listen.

Bert: There is a tendency for executive leaders to remain aloof, to be

too busy to listen, t o not be as approachable as one would like.
Iva: Listening takes time. It takes energy. It takes skill.
Bert: The reason for that aloofness is that executives are fearful and
people are fearful. I remember a time when I asked a colleague why he
never let anyone ask him a question. His response was, "Well, they might
ask me a question that I don't know the answer to."
Iva: Not having the answer is such a frightening experience for lead-
ers.
Bert: Sometimes leaders rhetorically ask, "Are there any questions?"
I usually count the number o f seconds the executive waits. If it's less
than five, I know they don't want questions. In that sense, you need the
skill of listening, but you also need the skills of self-awareness and over-
coming imagined fears-because they really are imagined more than real.
Iva: You've got to break the frame of a command-and-control cul-
ture where people have learned to wait for the leader t o tell them what
to do. That's going to be tough and awkward.
Bert: If you want to tear that barrier down, you have t o take a hard
look a t the artifacts of management in your culture that create that
sense of distance: the clothes, the Power Point slides, the seating
arrangements-
h a : The leader needs to tear down those barriers because they
become the barriers to truth-telling and communication. You need t o
provide enough time and space so that communication can be enabled.
Bert: And put people a t ease so they'll tell you the truth. Whether I
was in a technician's truck or in an executive meeting, I felt that people
believed that they could tell me what they thought-but the problem was
that I wouldn't always hear them.
Iva: Are you really sure that people felt that they could tell you what
they thought? You might have thought they really trusted you, but if you
didn't hear them they probably held back. Communication needs to be
symmetrical. Once you've lost trust it's very difficult to gain it back.
Bert: You could be right. You don't know what you don't know.
Iva: There may have been a disparity between your espoused values
and your theory-in-use. That's exactly what Rich Teerlink said.

Rich: People were always willing to tell management what

they thought, but the problem was that sometimes we didn't lis-
ten t o what they said! As leaders we want t o say, "Let's talk
about this. Let's look at the world a little differently." We have
good intentions but then we often end up being the kind of
 Chapter 11 /The Adaptable Map 267

leader who says, "Let's look at the world differently and here's
what I'm thinking." We leaders have to learn how t o keep our
mouths shut!

Questions t o Help You w i t h Engaging the Organization

Have you found a way to align personal and organization
goals as much as possible? Have you translated your vision,
values, and strategy into terms that people can engage with?
Are you driving change from the top? Do you appear to be
doing so?
Are you creating a "listening environment," an organiza-
tion that values inquiry and listening to others? Are you
engaged in dialogues about important things versus
"rolling it out"? Are people telling you honestly what they
think? Are these learnings shifting your awareness? Have
you been able to tap into the inherent commitment in
your organization?
Are there signs that the organization is engaged? Is the larger
system engaged?
Are your supportive networks and early adopters growing-
or are you the lonely (and "heroic") leader?

Phase 4: On the Journey

Those in the midst of the journey will face such questions as: How
do they know if what they're doing is working, if they're on the
road to success or failure-or oblivion? How do they know that
they have adequate feedback? Have they taken time for sufficient
reflection?
As you go through a change process, you need to keep your
feet on the ground. Because of our bias toward action and our ten-
dency to avoid reflection, we can sow the seeds of our own
destruction. Ironically, it is when we are deeply committed to
what we believe are high ideals that we become most intractable
and therefore most prone to failure. We can do this in many ways:
by being in denial, by feeling incredulous that others don't see the
value of these ideas, or by overreacting to negative feedback.

The Benefits of Reflection

Developing the capacity for reflection is one of the most impor-
tant aspects of the learning journey. We often use the excuse of
time, but that is most likely a rationalization. Many leaders rarely
268 Part 4 / Mapping

question their assumptions. They believe their assumptions are

sacrosanct, it is the implementation that is flawed. If one develops
the capacity to reflect in the midst of action one will be better able
to:
Detect "biological rejection phenomenon'' in the culture
and respond accordingly.
Center yourself as you experience the highs and lows that go
along with this journey.
Respond to the inevitable challenges that arise.
Recognize different types of feedback and how to act accord-
ingly. For example, what are the warning signs that things
are not going well? Or going too well?
Intuit the correct pacing and timing of things, thus enabling
you to effectively balance action with nonaction.
Anticipate learning from mistakes and failures.
Attend to your own personal development and transforma-
tion. As a leader of change, you need to find the means to
deal effectively with your blind spots, your fears, personal
weaknesses, and insecurities because they will most likely be
triggered and are likely to affect the way you manage change.

Questions to Help You Design in Reflection

Have you found ways to nurture reflection in both your-
selves and others?
Have you found ways to build both individual and collective
reflection (and double-loop learning) into the organizational
environment?
Are you getting feedback on how well you seem to be bal-
ancing action with non-action?
What is your response to feedback and challenges, mistakes,
and failures? Are you using them as opportunities for reflec-
tion and double-loop learning?
Do you notice that you tend to avoid reflection-particularly
questioning assumptions?
Are you reaching out for support?
Have you considered who defines success and failure for you?

Phase 5 : Journey's Landmarks

As the journey progresses, look for landmarks.
 Chapter 11 / The Adaptable Map 269

Questions to Help You Recognize Landmarks

Note the results you are experiencing. Are your results tangi-
ble if not quantifiable? Are the results surprising you? Are
there significant delays? If so, are there interim signals that
indicate that results are forthcoming?
What are you learning?
Is learning occurring at both the individual and team level?
What kind of learning (single- or double-loop learning) is
occurring? What assumptions are changing? How will that
learning translate into organizational learning?
Is the learning transferable? How?
Is the larger system engaged? How do you know?
Are there signs that the learning is self-sustaining?
We've summarized the guiding questions at each phase in
Table 11.2. This list is not meant to be exhaustive and we hope
that as you learn you will be inspired to challenge and improve
this list.
In this chapter we have tried to offer some considerations to
help you map your own learning journey. We offer them not as
prescriptions, but rather as perspectives derived from our collec-
tive reflection on our experiences and the experiences of four
other leaders. Through this period of reflection we have come to
believe that both we and our organizations would have benefited
if we had asked these questions as we mapped our own journeys.
At the same time, we recognize the fallibility of maps. As
Herman Melville wrote, "True places are not found on maps." The
purpose of the journey is not to follow the maps, but to find those
"true places." It is in this spirit that we offer these questions and
reflections to others.
270 Part 4 / Mapping

Table 11.2
Mapping the Journey

Phases of the Journey Suggested Areas of Inquiry

Phase 1 : Inviting a 1 Does this vision for my organization require a learning

Journey process in order to be actualized7
If so how can we articulate the connection? Can others see
the connection clearly?
Questions to Help with Cultural Analysis:
1 How is your culture likely to enhance or inhibit learning?
1 What are the strengths and weaknesses of your culture?

How will your culture affect how you implement a learning

effort7
1 Are you concerned with multiple subcultures7 How do they

differ and how do they relate to one another?

How might you go about this up-front analysis? What
resources are necessary?Who should be involved7
Timing-A Question of Readiness:
1 What is the relative financial health of your organization?
1 Is there a climate of openness and a receptivity to change?
1 Is there an opportunity for change such as a burning plat-
form or a Greenfield7
What is the natural heartbeat of the organization?
Finding Portals for Learning:
1 If you are involved in product development phases do the
periodic changeovers to a new product represent a portal7
Are there opportunities during the budget process For
example are there quarterly/periodic reviews to readjust the
budget to see how it compares with the forecast?
Does your performance review process include agreements
with employees about their personal development? Is the
company or division reviewing its training curriculum)
When you do employee surveys are there meetings to

.
1

determine what you re going to do about the results?

Are there TQM or other local initiative forums where new
ideas are fostered and tried? Many companies have Quality
audits which provide an opportunity to question assump-
tions What processes do you use to engage employees in
openly sharing their ideas? Would OL tools and methods be
helpful in that process?

.
Burning Platform:
Why are we getting these results that we don t want?
What are the systemic causes of these results7
Are we thinking about the future orjust reacting to the
present7
Leadership Readiness-Questions to Help You Assess
Your Self-knowledge:
1 Do you resonate with the qualities we have found in other
OL leaders?
1 Do you have a clear sense of why you want to embark on
thlSjOUrney? Where has that clarity come from?
a Ask yourself whether you have the strength of character to

define your own pathway Is your ego strong enough-but

not too strong?
1 Locate your level on the Rooke Torbert grid Are you a
Strategist? What are your strengths and weaknesses
 Chapter 11 / The Adaptable Map 271

vis-a-vis leading a learning effort7 What skills might you need

to develop?
Do you have the ability to communicate and network suc-
cessfully within the hierarchy and across functions7

Questions to Help You Assess Strength of Commitment:

.What is your experience with making commitments7

Are you prepared to conduct [several) experiments reflecting
and challenging your assumptions7
1 Can you make a commitment without knowing what the
outcome will be7
How important is this work to you7 Are you willing to put
yourjob on the line7

Questions to Help Assess Your Ability to Live in Paradox:

1 Can you both hold and live with creative tension7
1 Do you have the ability to live with [and within) two sys-
tems helping to build the bridge between them7

Questions to Help Assess Your Situational Acuity:

= What is your model of leadership7

.Is your leadership style flexible7 How do you know7

How might you develop your situational acuity7

Questions to Help Assess Your Openness to Learning

1 Are you prepared to learn from your mistakes, examining

your assumptions?
Can you let go and move on or do you tend to dwell on the

.past7
Can you show vulnerability admit to others that you don t
have all the answers7
1 Do you value and seek out diverse viewpoints7 Do you think
that good ideas can come from virtually anywhere?
1 Are you interested in nurturing the potential of others?
Have you reached out for appropriate help in making these
appraisals of yourself,

Ouestions to Help You Assess Your Practical

Knowledge and Ability
9 How well do you understand the systemic nature of
change7 Will you be able to identify strategies for weakening
the balancing processes7
9 Can you recognize-and resist-your organizations defen-
sive routines7
Do you have the practical ability to lead change7 What is the
status of your resources the strength of your network and
the courage of your allies7 Do you have enough influence
and credibility to execute7 What is the measure of credibility
in your organization7 Do you have both the support and the
political capital you need7
What are your strengths and weaknesses vis-a-vis leading a
learning effort7 Based on this overall assessment how would
you describe your learning edge7

Phase 2: Designing the Questions to Help Link Learning to Results:

Adaptable Map 1 Have you defined the results you expect from your learning
effort7 What kinds of personal results can people expect to
experience7 Have you discovered what results are meaning-
ful to the organization7
What measures will allow you to assess the impact of learn-
ing on results7
272 Part 4 / Mapping

Table 1 1.2 (continued)

Mapping the Journey

Phases of the Journey Suggested Areas of Inquiry

Phase 2: Designing the When do you expect to see results? Does the timing of antic-
Adaptable Map (continuedJ ipated results Jibe with the rhythm of the organization? If
not, will the organization be able to tolerate the delay? What
can you do to help the organization manage that tension?
Questions to Help You Consider the Boundaries
of Your System:
How have you defined the boundaries of the system you are
working wth? Are you working at the team level? The unit

. level? The organizational level?

How does the system you're concerned with interconnect
with other systems? If learning affects how your team or
department works, will there be an impact on other subsys-
tems?
When and how you will engage the larger system?

Questions to Help You Use Feedback Effectively:

1 Have you found and cultivated a supportive network? Have
you found people you trust who will give you honest feed-
back? To what degree are you open to coaching?
1 Have you created the necessary structural elements that
enable feedback for your organization. such as a reflective
analysis or an after-action review? Will feedback be commu-
nicated both to the team doing the work and to those as yet
uninvolved?
1 Is there coaching support provided for others in your organi-
zation?
Questions to Help You Plan for Assessment:
1 Who needs to agree on the terms of assessment? Are you
collaborating with them?
1 How should your learning effort be assessed? Should there
be qualitative as well as quantitative measures? Can you
define some interim indicators of progress?
1 In what time frame can you expect to see results? What if
there is a delay?
How can you capture what you learn along the way? How
will you diffuse what you are learning?
Questions to Help You Design in Sustainability:
Will you "leave it better than you found it"? Will the effects
be significant and long-lasting?
1 Is your learning effort "personality dependent"? Have you
created conditions such that the learning will continue if and
when you leave?
Phase 3: Beginning the Questions to Help You with Engaging the Organization:
Journey Have you found a way to align personal and organization
goals as much as possible? Have you translated your vision,
values, and strategy into terms that people can engage
with?
Are you driving change from the top? Do you appear to be
doing so?
1 Are you creating a "listening environment," an organization
that values inquiry and listening to others? Are you engaged
in dialogues about important things versus "rolling it out?"
 Chapter 11 / The Adaptable M a p 273

1 Are people telling you honestly what they think7 Are these
learnings shifting your awareness? Have you been able to
tap into the inherent commitment in your organization7
1 Are their signs that the organization is engaged? Is the larger
system engaged?
1 Are your supportive networks and early adopters growing-
or are you the lonely [and heroic ) leader7
Phase 4: On the Questions to Help You Design in Reflection:
Journey Have you found ways to nurture reflection in both yourself
and others7 Have you found ways to build both individual
and collective reflection /and double-loop learning) into the
organizational environment7
Are you getting feedback on how well you seem to be bal-
ancing action with non-action7
* What is your response to feedback and challenges, mistakes,
and failures7 Are you using them as opportunities for reflec-
tion and double-loop learning7
1 Do you notice that you tend to avoid reflection-particularly

questioning assumptions7 Are you reaching out for support7

Have you considered who defines success and failure for
you7
Phase 5: Journey's Questions to Help You Recognize Landmarks:
Landmarks 1 Note the results you are experiencing Are your results tangi-

ble if not quantifiable?Are the results surprising you7 Are

-
there significant delays7 If so are there interim signals that
indicate that results are forthcoming?
What are you learning7
1 Is learning occurring at both the individual and team level7

What kind of learning [single- or double-loop learningj is

occurring? What assumptions are changing7 How will that
learning translate into organizational learning7
* Is the learning transferable7 How?
1 Is the larger system engaged7 How do you know7

1 Are there signs that the learning is self-sustaining7

Endnotes

1. Daniel Boorstin, The Discoverers (NY: Random House, 1383),

p.153.
2. Edgar H. Schein, Organizational Culture and Leadership, 2nd ed.
(San Francisco: Jossey-Bass, 1332).
3. Edgar. H. Schein, Organizational and Managerial Culture AS a
Facilitator or Inhibitor of Organizational Learning (1334, working
paper available at www.so1-ne.org/res/wp/10004.html#one).
4. David Berdish, "Learning for Operational Excellence: A
Manager's Story," Reflections: The SOL Journal, 1333, Vol. I,
No. 1.
5. Arie de Geus, The Living Company (Boston: Harvard Business
School Press, 1337).
274 Part 4 / Mapping

6. Peter Senge et al., Dance of Change: The Challenges of Sustaining

Momentum in Learning Organizations (New York: Doubleday,
1333), pp. 10-21, 565-568.
7. Ralph Stacey, Managing the Unknowable: Strategic Boundaries
Between Order and Chaos in Organizations (San Francisco:
Jossey-Bass, 1392), pp. 146- 147.
8. George Roth and Art Kleiner, Car Launch: The Human Side of
Managing Change (New York: Oxford University Press, 2000),
pp. 103-110.
3 , Chris Argyris and Donald Schon, Organizational Learning
(Reading, MA: Addison-Wesley, 1378).
10. Marty Castleberg has done ground-breaking work in helping
teams within Harley Davidson develop their capacity to reflect
upon their collective experience and turn that reflection into
more thoughtful action. In his role as a reflective analyst (RA)
Marty has pioneered tools and methods, such as reflective
notes (FWs), which provide meaningful (and sometimes con-
frontational) feedback to the teams. The feedback helps team
members to think more systemically and critically, challenge
their assumptions, and draw value from diverse perspectives.
As one team member put it, It has given our team a perspec-
tive or way of looking at ourselves that we otherwise would
not have had.
The reflective feedback is structured such that it is available
to the team both in real-time and overtime so that they can
map their progress. At key moments, the feedback is com-
bined with individual ad hoc coaching-another aspect of the
RAs role. As a consequence of having access to an agent of
reflection, the HD teams have developed their capacity to
learn collaboratively and make better, more informed choices.
If you would like to contact Marty for more information, he
can be reached at his e-mail address: martberg@execpc.com.
11. Roth and Kleiner, 2000, op. cit., pp. 143-176.
12. Stacey, 1332, op. cit., p. 141.
Chapter 12
A Call t o Action

The Call
Bert: I would like us t o close with a call t o action. In order to have more
sustainable organizational learning projects we have t o have more attempts
a t sustainable projects. We have t o have more people trying, even if they
fail, so we can all learn.
Iva: We have acknowledged that there are perceived barriers t o busi-
nesses' adopting organizational learning. For example, we've acknowl-
edged that we do not have sufficient proof that these tools and methods
will yield specific financial results-particularly in the short term. But we
are also saying that we cannot provide this proof until we have more
businesspeople who are willing t o engage w i t h organizational learning.
In other words, they have t o be willing t o take a risk.
Bert: The theoreticians have raised the flag; they have been carrying
the banner. Businesspeople have not been carrying the banner because
o f all o f the things that we have been discussing. Nonetheless, this is a
call t o action for businesspeople-with a heavy dose o f reality thrown in.
Iva: When businesspeople have taken up the standard, when they
have tried t o implement these learning ideas in their organizations-as
we have tried t o do-that's when all the difficulties have arisen.
Bert: And therein lie all the learnings.
Iva: We're certainly talking about paradox here. On the one hand we
don't have proof that OL will lead t o improved financial results. On the
other hand we won't get that proof until we try. We're asking business-
people t o engage with paradox.
Bert: Yes, it is a paradox o f sorts, but that's the only way the theory
can be tested. It's the only way we can find out what works and what
doesn't. It's the only way we can figure out how t o change things. I rec-
ognize that this can seem pretty intimidating because the process o f

275
276 Part 4 / Mapping

change is still largely unknown to us. It seems complex, chaotic, and not
easily observable, except historically.
Iva: But you can see how that presents a dilemma to most people in
the business world. They cannot safely or reliably use the ideas and tools
until the bridge is built from here t o there.
Bert: We have incomplete knowledge, but when in the business
world did we ever act with complete knowledge? That's the essence o f
entrepreneurialism. I also say that we will never have that knowledge
without more experiments in the real world. We need to find better ways
t o measure and capture the impact that learning can have on an orga-
nization. We need better ways of anticipating and dealing with delays so
that we don't shut down good ideas too soon. We won't be able t o learn
how to do that unless businesspeople accept the risks and engage with
those questions.
If we in the business world don't accept this call to action and cre-
ate those experiments, then we are accepting the limitations of the
structure that we find ourselves in. We are accepting that we cannot get
there from here. I disagree strongly. I think we can.
h a : We do not know enough yet about how t o change our organi-
zations-we only know that we must. So, we must begin.
Bert: Despite my continued support of the notion of a heroic leader, I
also have to acknowledge that businesspeople can't do this alone.
Iva: We need to learn in community with one another. The kind o f
learning we're talking about is not a solitary endeavor. Transformative
learning requires other people. That means we still have more t o learn
about how to support each other's learning journeys.
Bert: It's time for the businessperson's dilemma to become every-
one's dilemma: academics, consultants, and businesspeople. There has t o
be compromise on the other side as well. The strong advocates of orga-
nizational learning are going to have t o balance their optimism with an
acceptance-maybe even appreciation-of the cynicism of many busi-
nesspeople. Even the people who go to organizational learning seminars
have something to learn about the importance of acknowledging current
reality. They are going t o have to temper the exuberance and somewhat
honeyed version of the world that you get when you go to these train-
ing courses with a solid understanding of just how difficult the transi-
tion to learning is going to be for most organizations.
Iva: You are asking the visionaries to come closer to the pragmatists.
What do you ask of the pragmatists?
Bert: It is time for people in the business world t o discuss the things
we usually never discuss. First and foremost, we must come to terms with
the fact that we are all part of a system. If we accept that-and we
must-there are implications. People in the business environment are
very comfortable with taking things apart and understanding the parts.
We might be able t o understand one part in detail very well, but we still
 Chapter 12 / A Call t o Action 277

are not able to create the opportunities for the firm to actualize its pur-
pose. For example, suppose you are the head of manufacturing. You have
a problem: your costs are too high. So you fix your cost problem by
changing your supplier, a solution which, in turn, creates a new set o f
operating and quality standards for the company. This apparent "fix" of
your problem in your area then ripples throughout the entire organiza-
tion. It complicates training, selling, and repair. It even potentially has an
impact on the effectiveness o f your product from a customer point of
view.
Iva: When we do things like change suppliers we're only concerned
with reducing our costs, but our actions don't only have an impact
inside the firm. They also have an impact on the outside world. We just
don't think about that impact. We think that the impact is for other
people t o worry about, because that's the nature of business, right? But
if we stopped and looked we would see how our actions might, through
connections in the marketplace, not only affect others but also impact
us negatively. For example, if that supplier that we drop goes out
o f business, the cost o f materials can go up and that could, eventually,
raise our costs again. We do not pay attention to how all this
connected. It's the Beer Game on a much larger scale, and we tend to
disregard it.
Bert: Unless we also take responsibility for understanding the rela-
tionship of the parts t o the whole and the relationships between the
parts, it is unlikely that we can actualize the potential o f the firm.
Iva: And, unless we commit t o that understanding, the business
world will not be able to take actions that contribute t o the greater good
even though there's increasing demand for more accountability.
Bert: Therefore, we must also engage in conversations that help cre-
ate greater awareness o f the larger systemic context in which business
operates including the human element and the environment and the
assumptions that we hold to be as true as gravity, but which are only
assumptions. That's a big difference from traditional strategic planning.
O f course, as a pragmatist I want these conversations to be both
generative and practical. They have to link organizational learning to the
real-world problems that businesspeople face. These conversations have
to have action-oriented outcomes.
Iva: I agree that that would be ideal for most businesspeople, but I'm
not certain that such conversations can be both generative and practical
at the same time. I'm not sure that we can go directly from awareness to
action. We may need to proceed more slowly-which will try the patience
of both pragmatists and visionaries.
Business has such enormous power today to shape what happens in
a community or a country, yet it isn't clear what responsibility business
has to society. However, organizational learning has started in the busi-
ness domain. Business could take the lead by applying what they have
278 Part 4 / Mapping

learned to other domains, to help ameliorate conflict and resolve social

prob Iems.
That's why the cat1 to businesspeople, especially line managers, who
have the responsibility to create wealth is so important. The more peo-
ple who are responsible for the bottom line become knowledgeable
about all of this, the better chance we have of moving forward.
Bert: The more we ply the philosophy that reinforces the importance
of learning, collective learning, learning as the principal means o f oper-
ating, the more likely we are to be able to change the system. If every-
body were learning it would change our system.
Iva: At its core, the whole idea behind organizational learning is that
there is hope. Organizational learning provides a glimpse of hope that we
can indeed create win-win situations for each other even though we have
different mental models, different racial or ethnic backgrounds, different
political affiliations. There is a way if we begin to think differently about
who we are and how we act and what we want t o create. That's what
organizational learning can offer us. Despite-and also because of-
everything we've said, I'm still convinced of that.
Bert: At the same time, I want us to be realistic about what we can
accomplish in what time frame. Recall Bill O'Brien's message: We're part
of a movement, part o f a shift that's been in the process of becoming for
a thousand years.
Iva: So we're on a journey. Learning how t o navigate that winding
road with all the pain and bumps is not easy. O f course, we want it to be
easy. We want the risks and barriers removed. We want the formula, the
silver bullet, the single path, but this is a journey. We have t o be willing
to leave that longing behind-
Bert: And get on the road.

So the journey comes full circle. Business organizations are

poised at a transition point. Organizational learning has emerged
as an alternative to the thinking that has traditionally guided busi-
ness leadership and management. Can we embrace this new alter-
native? What will it take to do so?
Throughout this book we have shown the tension that exists
between what we have termed the pragmatist and the visionary
orientations. Through this dichotomy we have reflected upon the
inspiration that pulls many toward organizational learning and
the vision that is embedded in its potential. We have also honored
the forces that hold us back, tethering the majority quite firmly to
current reality.
But one of the tenets of organizational learning is that we
must dispense with the tendency to dichotomize, therefore we
must come to terms with this dichotomy. So another way to view
 Chapter 12 / A Call t o Action 279

the seeming polar opposites of pragmatist and visionary is to see

them not as binary choices but as aspects of a greater whole and
therefore, as reflections of each other. Each, when taken to the
extreme, can become a closed system. Pragmatism taken to its
extreme becomes impractical. As we have seen with Argyriss
Model I, attempts to be consistently rational can become irra-
tional and a determination to win can translate into rigid learn-
ing systems built upon self-defeating defensive routines. Mental
models that cannot be questioned become fodder for the jokes of
tomorrow.
Born out of a rejection of grand ideological schemes, pragma-
tism taken to an extreme can lead to the out-and-out rejection of
ideas not because they are impractical, but primarily because they
are ideas-particularly if they threaten the status quo. While it has
been said that nothing is as practical as a good theory, pragma-
tists can refuse ideas until they are proven safe, making the win-
dow of opportunity for change very small indeed.
Likewise, the visionary can stumble. The visionary runs the
risk of becoming the true believer, who is so convinced of the
vision that his or her vision also solidifies into unquestioned ide-
ology. To be gifted with vision is to be given the ability to see pos-
sibilities. However, convinced of his or her vision, a visionary can
become a knower who then ceases to see clearly and who does not
inquire into nor seek to understand or learn from the sources of
resistance. It requires deftness and skill to sort through when and
how to urge a vision forward and when to hold back, revisit,
rethink, and readjust.
Neither the visionary nor the pragmatist is all right or wrong.
Both have much to learn from each other and, together, they can
create a potent, mutually reinforcing learning system out of which
could emerge a new, less illusory and more fulfilling reality.
The pragmatists can teach the visionaries much about what is
needed in order to build the bridge from our current, practical
business reality-however illusory-to something better. If the
visionaries are able to inquire deeply and sensitively enough, the
pragmatists can teach them much about the power of fear. From
the pragmatists, the visionaries can learn how fear often comes
disguised as an unquestioned need for control and how, ironically,
the visionaries can trigger a fearful response in the pragmatists.
The visionaries can learn to see what the pragmatist sees and
understand the practical requirements for turning visions into tan-
gible realities.
From the visionaries, the pragmatists can learn a sense of pos-
sibility. As they begin to become open to the greater sense of the
systemic perspective, they can begin to expand their sense of what
280 Part 4 / Mapping

is in the best interests of business. They can begin to see that their
bedrock beliefs are mental models of an increasingly illusory
sense of reality. They can begin the painful process of acknowl-
edging what they have had to give up for those beliefs. In time,
they can begin to reclaim the closed-off parts of themselves,
relearning how to aspire and create.
The visionary and the pragmatist represent two sources of wis-
dom. And, just as a walk to a new place requires two feet, so does
our journey require these two sources of wisdom. But the vision-
ary and the pragmatist do not constitute the whole. As Paula
Underwood has written, it is those who see both possibilities who
truly sustain a people.' It follows, then, that this transition lies in
the hands of those of us who can appreciate both wisdoms.
To be effective in this time of transition we must honor both
perspectives and develop the capacity to live within the tension
between them for as long as it is necessary. There are few things
that will be harder to do because we will be driven to reduce the
tension. We will be pulled inexorably toward one end or the other.
We may tend to oscillate, causing confusion in others and discor-
dance within ourselves. When the pragmatist within perceives a
threat to the bottom line, this will trigger a tendency to disengage
with learning, to see it as superfluous to getting the job done. At
that same moment the visionary tendency will be to push harder,
urging the pragmatist to let go of the old rules.
Once we have awakened to this tension we must remind our-
selves that at each moment we have the option to respond either
reactively or creatively to that tension. Of course, most of us have
been conditioned to respond reactively to circumstances; most
corporate cultures reinforce this reactive behavior. We may not yet
know how to break the cycle of conditioned response. We may not
yet be able to reframe so that we can perceive the reality from a
different perspective and, in the process, change our perceptions.
There are no easy answers. We will not be able to create this
transition to learning if we believe that we must first resolve all of
the demands of pragmatism. Nor can we get there by sheer force
of vision. The simplest thing that can be said is to begin to notice
when we are being pulled toward one extreme or the other. At that
moment, stop and ask questions such as: What is going on? Why
is this moment triggering me to move back to my safety zone?
What am I afraid of? What can I learn by staying with this
moment? How can I inquire into it? Can I respond in a more cre-
ative way to this situation?
The transition will come down to these moments and to our
individual and collective responses to them. To live in this tension
and to address it creatively-in each moment-is the challenge to
pragmatist, visionary, and those who value both.
 Chapter 12 / A Call t o Action 281

Endnote

1. Paula Underwood, 7'he Walking People: A Native American Oral

History, (San Anselmo, CA: A Tribe of Two Press, 1333). Paula
Underwood is an author, a lecturer, a trainer. and a consultant
in education, cross-cultural understanding, and organization-
al methodologies based on lifelong training and experiences
in a Native American philosophy.
Index
Page references with tdenote tables
A Double-loop learning, 43-50,
Accidental learning, 48-43 53, 163-178
Action-logics, 176-1 77 Downsizing, 15-17, 27t
Adaptable map, 256-257,
271t-272t F
Air cover, 76, 35, 101, 170 Fazio, Phil, 112, 125-127,
Analysis, SWOT, 74-75, 235 133-137
Argyris, Chris, 43, 48-52, 53, Fear, 152-153
101, 104, 144, 157-160, 177, Feedback, 260-261, 272t
221, 223, 248, 253
Aspirations, 145-146
G
Assessment, 261-263, 272t
Governing variables, 51-52
B
H
Beer Game, 6-3
Beliefs, 153- 154 Ilamel, Gary, 23
Biological rejection phenom- Heil, Gary, 28, 87
enon, 81, 166-167, 268
I
C I S 0 3000, 14-15
Carroll, Phil, 185-186, 188,
183, 131-132, 135-138, 201, J
208-212, 235, 248-243, Journeys, 63-32, 111-133
252, 263-264
Change, 43, 38-102, 141-142,
K
144- 145, 147- 148,
156-158, 243 Kim, Daniel, 6 3 , 124
Commitment, 252-253 Knowledge
Creative tension, 40-41 practical, 25 5 -25 6
Culture, 236t-237tI 238-233 self-knowledge, 251-2 52
Kolb, David, 44
D
L
de Geus, Arie, 21, 28, 240
Devolving of power, 223 Ladder of inference, 58t
Dialogue, 53t, 148-150, 156 Leaders, 247-256
Diffusion of innovation, Leadership, 106-108, 181-230
150- 151 situational, 172, 21 5-21 8
Dixon, Nancy, 47-48

283
Learning, 106-108, 244-247,
254-255. See also
Organizational learning
double-loop, 43-50, 53,
163- 178
single-loop, 48-43, 103- 110
Learning cycle, 45
Learning journey, 233-233,
257-274
Limited learning systems,
51-53, 95
M Personal mastery, 4, 224
Marsing, Dave, 186- 187,
132-134, 133-201, 203,
208, 203, 222, 226,
242-243, 245, 246, 251
Measurement, 37-39
Mental models, 4
Mlakar, Dan, 63, 73, 80, 83-84,
103, 107
Model I-based organizational
learning, 52-60, 55t, 34,
101-106, 108-110, 144,
157-160, 163, 167, 175,
223,253, 260, 265
Model 11-based organizational
learning, 52-60, 55t, 58t, 34,
101- 106, 108- 110, 144,
157-160, 163, 167, 175,
229, 253, 260, 265
Moment of Truth, 87-30,
105-106
0 38-100, 103-105, 107, 111,
OBrien, Bill, 183, 184, 183,
130, 204, 205, 215, 227, 228,
245
Organizational learning, 4-5,
27t, 30-31, 40-41, 47,
50-51, 53-54, 34-35,
150-151, 278-280. See also
Learning
Organizational model I learn-
ing system, 52-60, 55t, 94,
101-106, 108, 144, 157-160,
163, 167, 175, 223, 253,
260, 265
Organizational model I1 learn-
ing system, 52-60, 55t, 58t,
34, 101-106, 108, 144,
157-160, 163, 167, 175,
223, 253, 260, 265
P
Power, devolving of, 223
Practical knowledge, 255 -25 6
Pragmatism, 273
R
Reengineering, 14-15, 26t
Reflection, 22 2 -224,2 6 7-2 6 8,
273t
Reorganizing, 11-13, 26t
Resistance, 148
Results, 17- 13
Rooke, David, 176- 177, 229,
252
S
Schein, Ed, 236-238
Schon, Donald, 51-52, 144,
223, 259
Self-knowledge, 251-252
Senge, Peter, 35, 40, 47, 68,
122, 126, 145-148, 152,
153, 157, 133, 203, 224,
238, 248, 243, 255
Shared vision, 4
Simulations, 30-31, 102-104
Single-loop learning, 48-43,
103-110
Situational acuity, 254-255
 Index 285

Situational leadership, 172, Tension, 40-41, 142, 278, 280

21 5-21 8 Timing, 233-244
Stacey, Ralph D., 103, 228, 223, Torbert, William, 176- 177,
256, 265 223, 252
Strata, Ray, 176 Total quality management, 3,
Sustainability, 263-265 13-14,26t, 33-36, 66-70,
SWOT analysis, 74-75, 235 34, 113-121
Systems
boundaries of, 253-260, 272t v
creation of, 9-10
Values, 35-33, 187-130, 234
linkages of, 253-260, 272t
Vision, 146-147, 158-153,
Systems thinking, 5-9
233-234, 273
T
W
Team learning, 5
Worldviews, 1GO
Teerlink, Rich, 185, 130- 131,
133, 200, 202, 208, 220,
223, 264-266